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Tax Year 2021 Foreign Account Reporting: Introduction | FBAR International Tax Lawyer

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Hello and welcome to Sherayzen Law Office Video blog. My name is Eugene Sherayzen and I’m an international tax attorney and owner of Sherayzen Law Office, Ltd.

Today, I’m continuing my series of vlogs from Mexico City. I’m in the Colonia Reforma Social and I’m thinking about your upcoming tax year 2021 tax compliance. Right now, I’d like to focus, just on your foreign financial accounts. For the tax year 2021, you will need to file certain forms for your foreign accounts.

For example, if your accounts exceed $10,000, then you will have to file an FBAR; if your accounts exceed $100,000 and you reside in the United States, then you will have to file a Form 8938. If your foreign accounts contain PFICs (passive income), then you will have to file Forms 8621. In other words, having foreign financial accounts will result in a fairly substantial amount of US tax reporting requirements depending on the actual balances that you have on your foreign financial accounts. The lower you have, the lower the compliance you have. The higher the balances that you have on your bank and financial accounts, the more compliance you will have to do.

Now, keep in mind that you also need disclose the ownership of foreign accounts, irrespective of whether you have to file FBAR, Form 8938 or Form 8621 on Schedule B. You will have to indicate that you do not have to file an FBAR if you really do not have to do it.

In the next blog, I will continue talking about your 2021 FBAR compliance.

Thank you for watching, until the next time.

Preparing for the Tax Year 2021 Compliance | US International Tax Lawyer

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Good morning and welcome to Sherayzen Law Office video blog. My name is Eugene Sherayzen; I’m an international tax attorney and owner of Sherayzen Law Office, Ltd.

I am continuing with a series of vlogs from Mexico City and today I’d like to talk about the upcoming tax season for the tax year 2021. The tax season started at the end of January 2022, and you might as well be preparing for it now, especially if you have foreign assets like foreign business ownership interests and foreign corporations, foreign partnerships or foreign disregarded entities, also if your have foreign financial accounts because you are looking at a significant amount of compliance, which has increased since the last year.

It’s not just a matter of doing the same thing that you have done in the past, it’s also a matter of taking into account the extra compliance that will come into play this year.

What you need to do right now is to start gathering all of the information for the calendar year 2021; put everything together: financial statements for the foreign corporations, financial statements for foreign trusts, if you are a beneficiary or owner of a foreign trust, financial statements for foreign partnerships, as well as things like fixed asset appreciation reports and things as simple as foreign bank account statements that will cover the entire year 2021.

In the next blog, I will continue talking more about your tax year 2021 tax compliance.

Thank you for watching, until the next time.

Form 8938 Does Not Replace FBAR Reporting | FBAR Tax Lawyer & Attorney

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Hello, and welcome to Sherayzen Law Office video Blog. My name is Eugene Sherayzen and I’m an international tax attorney and owner of Sherayzen Law Office, Ltd.

Today, I’d like to talk to you about the situation where an account was disclosed on Form 8938 but it was not disclosed on FBAR or as it’s know by it’s official name, FinCEN Form 114.

Does your disclosure on Form 8938 replace the FBAR nondisclosure? That’s a question I often hear from taxpayers who come to me for help; and the answer is ‘no’. Unfortunately, just because you disclosed an account on Form 8938, that does not in any way eliminate your obligation to report the same account on Form 114 (or FBAR).

Will it help your non-willfulness case? Yes, it will but you still have to file your FBARs. You still have to disclose on your FBARs all of the foreign accounts you are required to disclose, otherwise you are on the hook for the penalties, even if they are not willful-type penalties; they may be non-willful penalties. It will depend on the particular facts and circumstances of your case.

If you would like to know more about your FBAR compliance, you can contact me (952) 500-8159 or you can email me at [email protected].

Thank you for watching, until the next time.

Certification of Non-Willfulness: Required Length | Streamlined Domestic Offshore Procedures Lawyer

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Hello, and welcome to Sherayzen Law Office video Blog. My name is Eugene Sherayzen and I’m an international tax attorney and owner of Sherayzen Law Office, Ltd.

Today, we’re continuing our series of blogs from Beverly Hills, California. I’d like to go back to the issue that I’ve already touched upon in a previous blog; that is, the certification of non-willfulness. I mentioned and described, to a certain degree the attachment that must go with your Form 14654 or Form 14653: the certification of non-willfulness for SDOP and certification of non-willfulness for SFOP respectively.

What I’d like to talk to you about today is how extensive this attachment needs to be. I’ve seen non-willfulness statements that are only a few pages long or sometimes only a few paragraphs long. Neither will likely prove satisfactory. Maybe, if the case is very simple, sometimes you can fit it into a few pages, though, I doubt it.

In my experience, to properly state the case for non-willfulness and state it to the degree that it would satisfy the IRS; one cannot be stingy with facts and with arguments. The bigger your non-willfulness statement, the more direct, the more forthcoming, the more detailed it is along with the sequence of events that makes logical sense, the better off you are. The stronger your argument of non-willfulness will be, the more likely that looking at a statement like this, the IRS is not going to audit your Offshore Voluntary Disclosure.

That is: a good non-willfulness statement is the key to reducing your potential audit exposure in the Voluntary Disclosure.

If you would like to learn more about SDOP or SFOP, please call me at (952) 500-8159 or you can email me at [email protected].

Thank you for watching, until the next time.

Certification of Non-Willfulness | Offshore Voluntary Disclosure Tax Lawyer & Attorney

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Hello, and welcome to Sherayzen Law Office video Blog. My name is Eugene Sherayzen and I’m an international tax attorney and owner of Sherayzen Law Office, Ltd.

We are continuing our series of vlogs from Beverly Hills, California and today, I’d like to talk to you about probably the most critical document that you need to submit as part of your Streamlined Domestic Offshore Procedures. Actually, as a matter of fact, it is also the most critical document that you would have to submit as part of your Streamlined Foreign Offshore Procedures.

This document is the Certification of Non-Willfulness. The Certification of Non-Willfulness, Form 14654, in the case of Streamlined Domestic Offshore Procedures or Form 14653, in the case of Streamlined Foreign Offshore Procedures, in of itself is not a complex form. In fact, most of it’s language is already determined by the IRS. All you need to do is input certain numbers/certain amounts; so, that part, while it’s critical to do correctly, is not the most crucial part of your Streamlined Disclosure.
The most crucial part, and something that most people do not realize, is the explanation, the attachment, that has to go with your Form 14654 or Form 14653.

That explanation is a critical part of your Offshore Voluntary Disclosure.

  1. It must state all relevant facts
  2. Describe the circumstances that led to non-compliance
  3. State (and this is the critical part) the legal case that will form the crux of your legal argument for non-willfulness

Proving non-willfulness is critical; if you cannot prove non-willfulness, you cannot do a Streamlined Domestic Offshore Procedures or a Streamlined Foreign Offshore Procedures, for that matter.

If you would like to know more about the SDOP process or the process for establishing non-willfulness as part of the SDOP, please call me at (952) 500-8159 or you can email me at [email protected]

Thank you for watching, until the next time.