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On February 14, 2013, the U.S. Department of the Treasury announced that it has signed a bilateral agreement with Switzerland to implement the information reporting and withholding tax provisions commonly known as the Foreign Account Tax Compliance Act (FATCA). Enacted by Congress in 2010, FATCA targets non-compliance by U.S. taxpayers using foreign accounts. The bilateral […]
In an earlier article, I discussed the key requirements of the Offshore Voluntary Disclosure Program (OVDP) now closed. In this essay, I would like to outline the general OVDP administrative process from initial pre-clearance through the execution of the Closing Agreement. General Description In order to participate in the OVDP, the taxpayer must first be […]
There are some taxpayers who should not be using the official IRS Offshore Voluntary Disclosure Program (OVDP) now closed. The IRS expressly singled out one category of such taxpayers in its Q&A 17 of the OVDP Rules. Q&A 17 only applies to the taxpayers who reported and paid tax on all their taxable income for […]
In my practice I have encountered situations where a taxpayer has delinquent Form 5471 or Form 3520, but there is no additional tax liability associated with the delinquent forms. In these situations, a natural questions arises on how to best deal with this situation. One of the options is to follow Q&A 18 of the […]
As the IRS engages in negotiations with foreign governments to implement FATCA (Foreign Account Tax Compliance Act) overseas, there is a rising pressure from some countries for reciprocity – the implementation of FATCA-like disclosure of foreign clients’ U.S. accounts to those clients’ home governments. FATCA Background FATCA was enacted in 2010 and set to begin […]