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Beware of Flat-Fee Lawyers Doing Streamlined Domestic Offshore Procedures

Recently, I received a number of phone calls and emails from people who complained about incorrect filing of their Streamlined Domestic Offshore Procedures (“SDOP”) packages by lawyers who took their cases on a flat-fee basis. In this article, I would like to discuss why a flat fee is generally not well-suited for a proper SDOP preparation and why clients should critically examine all facts and circumstances before retaining flat-fee lawyers.

A small disclosure: the analysis below is my opinion and the result of my prior experience with SDOPs. Moreover, I am only describing general trends and there are certainly exceptions which may be applicable to a specific case. Hence, the readers should consider my conclusions in this article carefully and apply them only after examining all facts and circumstances related to a specific lawyer before making their final decision on whether to retain him.

Flat-Fee Lawyers versus Hourly-Rate Lawyers

The two main business models that exist in the professional tax community in the United States with respect to billing their clients are the hourly-rate model and the flat-fee model. The hourly-rate model means that an attorney’s fees will depend on the amount of time he actually worked on the case. The flat-fee model charges one fee that covers a lawyer’s work irrespective of how much time he actually spends on a case.

Both billing models have their advantages and disadvantages. Generally, the chief advantage of an hourly-rate model is potentially higher quality of work. The hourly-rate model has a built-in incentive for attorneys to do as accurate and detailed work as possible, maximizing the quality of the final work product. An hourly-rate attorney is likely to take more time to explore the documents, uncover hidden problems of the case and properly resolve them.

The disadvantage of an hourly-rate model is that it cannot make an absolutely accurate prediction of what the legal fees will ultimately be. However, this problem is usually mitigated by estimates – as long as he knows all main facts of the case, an experienced attorney can usually predict the range of his legal fees to cover the case. Only a discovery of substantial unexpected issues (that were not discussed or left unresolved during the initial consultation) will substantially alter the estimate, because more time would be needed to resolve these new issues.

The chief advantage of the flat-fee model is the certainty of the legal fee – the client knows exactly how much he will pay. A secondary advantage of this model is the built-in incentive for flat-fee lawyers to complete their cases as fast as possible.

However, this advantage is undermined by several serious disadvantages. First, the flat-fee model provides a powerful incentive for lawyers to spend the least amount of time on a client’s case in order to maximize their profits; in other words, the flat-fee model has a potential for undermining the quality of a lawyer’s work product. Of course, it does not happen in every case, but the potential for such abuse is always present in the flat-fee model.

Second, closely-related to the first problem, the flat-fee model discourages lawyers from engaging in a thorough analysis of their clients’ cases. This may later result in undiscovered issues that may later expose a client to a higher risk of an unfavorable outcome of the case. Again this does not happen in every case, but I have repeatedly seen this problem occur in voluntary disclosures handled by flat-fee lawyers and CPAs.

Finally, a client may actually over-pay for a flat-fee lawyer’s services compared to an hourly-rate attorney, because a flat-fee lawyer is likely to set his fees at a high level to make sure that he remains profitable irrespective of potential surprises contained in the case. Of course, there is a risk for flat-fee lawyers that the reverse may occur – i.e. despite being set to a high level, the fee is still too small compared to issues involved in a case.

The effective usage of either one of these billing models differs depending on where they are applied. In situations where the facts are simple and legal issues are clear, a flat-fee model may be preferable. However, where one deals with a complex legal situation and the facts cannot all be easily established during an initial consultation, the hourly-rate model with its emphasis on thoroughness and quality of legal work is likely to be the best choice.

Flat-Fee Lawyers Can Be An Inferior Choice for Streamlined Domestic Offshore Procedures

In my opinion and based on the analysis above, in the context of an SDOP voluntary disclosure, a flat-fee engagement is particularly dangerous because of the nature of offshore voluntary disclosure cases.

Voluntary disclosures are likely to deal with complex US international tax compliance issues and unclear factual patterns. It may be difficult to identify all legal issues and all US international tax reporting requirements during an initial consultation. There are too many facts that clients may simply not have at their disposal during an initial consultation. Moreover, additional issues and questions are likely to arise after the documents are processed. I once had a situation where I discovered that a client had an additional foreign corporation with millions of dollars only several months after the initial consultation – the corporation was already closed and the client forgot about it.

For these reasons, SDOP and offshore voluntary disclosures in general require an individualized, detailed and thorough approach as well as a hard-to-determine (during an initial consultation) depth of legal analysis which is generally ill-fit for a flat-fee engagement. A flat-fee lawyer is unlikely to accurately estimate how much time is required to complete a client’s case and, hence, unlikely to accurately set his flat fee for the case.

This can cause a huge conflict of interest as the case progresses. I have seen a number of cases where, in an attempt to remain profitable, flat-fee lawyers did their analysis too fast and failed to properly identify all relevant tax issues; as a result, the voluntary disclosures (including SDOP disclosures) done by them had to amended later by my firm. This caused significant additional financial costs and mental stress to my clients.

In my opinion, this potential conflict of interest makes the flat-fee model unsuitable for the vast majority of the SDOP cases.

Beware of Some Flat-Fee Lawyers Including Unnecessary Services Into the Flat Fee

This applies only to a tiny minority of flat-fee lawyers. I have observed several times where flat-fee lawyers included irrelevant services that the client never used to increase the flat fee for the case (for example, audit fees for years not included in the SDOP). My recommendation is that, if you decide to go with a flat-fee arrangement, you should make sure that it includes only the services that you will likely use.

Contact Sherayzen Law Office for Professional Help With Streamlined Domestic Offshore Procedures

Sherayzen Law Office is a leader in SDOP disclosures. We have helped clients from over 70 countries with their offshore voluntary disclosures, including SDOPs. Our firm follows an hourly-rate billing model, because we value the quality of our work above all other considerations. Of course, we make every effort to make our fees reasonable and competitive, but our priority is the peace of mind of our clients who know that they can rely on the creativity of our legal solutions and the high quality of our work.

Contact Us Today to Schedule Your Confidential Consultation!

Introduction to Corporate Distributions | US Business Tax Law Firm

This essay opens our new series of articles which focuses on corporate distributions. The new series will cover the classification, statutory structure and tax treatment of various types of corporation distributions, including redemptions of corporate stock. This first article seeks to introduce the readers to the overall US statutory tax structure concerning corporate distributions.

Corporation Distributions: Legal Philosophy for Varying Treatment

In the United States, the tax code provisions with respect to corporate distributions were written based on the belief that stock ownership bestows on its owner an inherent right to determine the right to receive distributions from a corporation.

Generally, a corporation can make distributions from three types of sources. First, a corporation can distribute funds from its accumulated earnings, to be even more precise accumulated Earnings and Profits (E&P). Second, a corporation may also distribute some or all of the invested capital to its shareholders. Finally, in certain circumstances, a corporation may distribute funds or property in excess of invested capital.

Moreover, certain corporate distributions may in reality be made in lieu of other types of transactions, such as payment for services. Additionally, some corporate distributions may be made in the form of stocks in the corporation, which may or may not modify the ownership of the corporation and which may or may not entitle shareholders to additional (perhaps unequal) future distribution of profits.

This varied nature of corporate distributions lays the foundation for their dissimilar tax treatment under the Internal Revenue Code (IRC).

Corporation Distributions: General Treatment under §301

IRC §301 generally governs the tax treatment of corporation distributions. This section classifies these distributions either as dividends, return of capital or capital gain (most likely, long-term capital gain). In a future article, I will discuss §301 in more detail.

Corporation Distributions: Special Case of Stock Dividends

The IRC treats distribution of stock dividends in a different manner than distribution of cash and property. Under §305(a), certain stock distributions are not taxable distributions. However, §305 contains numerous exceptions to this general rule; if any of these exceptions apply, then such stock distributions are governed by §301.

Moreover, additional exceptions to §305(a) are contained in §306. If a stock distribution is classified as a §306 stock, then the disposition of this stock will be treated as ordinary income. In a future article, I will discuss §§305 and 306 in more detail.

Corporation Distributions: Special Case of Stock Redemptions

Stock redemptions is a special kind of a corporate distribution. §317(b) defines redemption of stock as a corporation’s acquisition of “its stock from a shareholder in exchange for property, whether or not the stock so acquired is cancelled, retired, or held as treasury stock.”

§302 governs the tax treatment of stock redemptions. In general, it provides for two potential legal paths of stock redemptions. First, if a stock redemption satisfies any of the four §302(b) tests, then it will be treated as a sales transaction under §1001. Assuming that the redeemed stock satisfied the §1221 definition of a capital asset, the capital gain/loss tax provisions will apply.

On the other hand, if none of the §302(b) tests are met, then the stock redemption will be treated as a corporate distribution under §301. Again, in a future article, I will discuss stock redemptions in more detail.

Corporate Distributions in the Context of US International Tax Law

All of these tax provisions concerning corporate distributions are relevant to US shareholders of foreign corporations. In fact, in the context of US international tax law, these tax sections become even more complex and may have far graver consequences for US shareholders than under purely domestic tax law. These consequences may be in the form of higher tax burden (for example, due to an anti-deferral tax regime such as Subpart F rules) or increased compliance burden (for example, triggering the filing of international information returns such as Form 5471 or Form 926).

A failure to recognize these differences between the application of aforementioned tax provisions in the domestic context from the international one may result in the imposition of severe IRS noncompliance penalties.

Contact Sherayzen Law Office for Professional Tax Help Concerning Corporation Distributions

Sherayzen Law Office is an international tax law firm highly-experienced in US and foreign corporate transactions, including corporate distributions. We have helped our clients around the world not only to engage in proper US tax planning concerning cash, property and stock distributions from US and foreign corporations, but also resolve any prior US tax noncompliance issues (including conducting offshore voluntary disclosures). We can help you!

Contact Us Today to Schedule Your Confidential Consultation!

§318 Entity-Member Attribution Summary | International Tax Lawyer

In a previous article, I discussed the IRC (Internal Revenue Code) §318 sidewise attribution limitation. This limitation was the last piece in the jigsaw puzzle of the §318 entity-member attribution rules; now, we are ready to summarize these rules in light of this exception. This is the purpose of this article – state the §318 Entity-Member Attribution summary.

§318 Entity-Member Attribution Summary: Definition of Member

For the purpose of this §318 Entity-Member Attribution summary, I am using the word “member” to describe partners, shareholders and beneficiaries.

§318 Entity-Member Attribution Summary: Limitations

This summary of §318 entity-member attribution rules is limited only to situations where a member owns at 50% of the value of stock (in case of a corporation) and a beneficiary of a trust does not hold a remote and contingent interest in a trust. The readers need to keep these limitations in mind as they apply the summary below to a particular fact pattern.

Moreover, the readers must remember that this summary of the §318 Entity-Member attribution rules may be altered when one applies it within the context of a specific tax provision. Hence, the readers must check for any modification of these §318 attribution rules contained in that specific tax provision.

§318 Entity-Member Attribution Summary

Now that we understand the limitations above, we can state the following summary of the §318 Entity-Member attribution rules:

  1. All corporate stock is attributed to an entity from its member irrespective of whether the member owns this stock actually or constructively;
  2. If corporate stock is attributed from an entity to its member, such attribution will be done on a proportionate basis; and
  3. The following corporate stock is attributed from an entity to its member on a proportionate basis:
    (a). Corporate stock which the entity actually owns;
    (b). Corporate stock which the entity constructively owns under the option rules; and
    (c). Corporate stock which the entity constructively owns because it is a member of some other entity.

Contact Sherayzen Law Office for Professional Help With US International Tax Law Compliance

US international tax law is incredibly complex and the penalties for noncompliance are exceptionally severe. This means that an attempt to navigate through the maze of US international tax laws without assistance of an experienced professional will most likely produce unfavorable and even catastrophic results.

This is why you should contact Sherayzen Law Office for professional help with US international tax law. We are a highly experienced, creative and ethical team of professionals dedicated to helping our clients resolve their past, present and future US international tax compliance issues. We have helped clients with assets in over 70 countries around the world, and we can help you!

Contact Us Today to Schedule Your Confidential Consultation!

July 15 Deferral: More Deadlines Affected | US International Tax News

On April 9, 2020, the IRS announced additional relief to taxpayers by moving the due date for more deadlines to July 15, 2020. Let’s discuss this additional July 15 Deferral in more detail.

July 15 Deferral: Background Information

On March 13, 2020, in response to the 2019 coronavirus (also called “COVID-19″) pandemic, President Trump issued an emergency declaration under the Robert T. Stafford Disaster Relief and Emergency Assistance Act. This declaration instructed the Treasury Department to provide relief from tax deadlines to Americans who have been adversely affected by the COVID-19 emergency pursuant to 26 U.S.C. §7508A(a).

Section 7508A of the Internal Revenue Code provides the Secretary of the Treasury with authority to postpone the time for performing certain acts under the internal revenue laws for a taxpayer determined by the Secretary to be affected by a federally-declared disaster as defined in section 165(i)(5)(A). Pursuant to section 7508A(a), a period of up to one year may be disregarded in determining whether the performance of certain acts is timely under the internal revenue laws.

On March 18, 2020, the IRS issued Notice 2020-17 to postpone April 15 tax payment deadlines from April 15 to July 15, 2020. A few days later, on March 21, 2020 (the actual relief occurred even earlier on March 20, 2020), among other measures, the IRS announced a new notice 2020-18 for the extension of all April 15 deadlines to July 15, 2020. This extension applied only to the April 15 deadlines.

Later, on March 27, 2020, the IRS issued Notice 2020-20, which amplified the earlier notice 2020-18 and postponed certain federal gift tax return filings and payments to July 15, 2020.

July 15 Deferral: More Deadlines Affected

On April 9, 2020, the IRS took another decisive step forward and issued Notice 2020-23. This notice extends to July 15 all tax deadlines that fall on or after April 1, 2020 and July 14, 2020. This deferral applies to all tax filing and tax payment deadlines.

The July 15 deferral of deadlines applies to all taxpayers – individuals, trusts, estates, corporations and other non-corporate tax filers.

July 15 Deferral: Taxpayers Residing Abroad

Americans who reside abroad usually get an automatic extension to file their tax returns until June 15, but they are required to pay taxes due by April 15. Notice 2020-23 defers the tax payment and the tax filing deadlines from April 15 and June 15 respectively to July 15, 2020.

July 15 Deferral: Individual Tax Returns

Notice 2020-23 applies to the following types of individual tax returns and tax payments:

  1. Form 1040, U.S. Individual Income Tax Return, 1040-SR, U.S. Tax Return for Seniors;
  2. 1040-NR, U.S. Nonresident Alien Income Tax Return;
  3. 1040-NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens With No Dependents;
  4. 1040-PR, Self-Employment Tax Return – Puerto Rico; and
  5. 1040-SS, U.S. Self-Employment Tax Return (Including the Additional Child Tax Credit for Bona Fide Residents of Puerto Rico);

July 15 Deferral: Corporate Tax Returns

Notice 2020-23 applies to the following types of corporate tax returns and tax payments (irrespective of whether they are calendar-year or fiscal-year taxpayers):

  1. Form 1120, U.S. Corporation Income Tax Return;
  2. 1120-C, U.S. Income Tax Return for Cooperative Associations;
  3. 1120-F, U.S. Income Tax Return of a Foreign Corporation;
  4. 1120-FSC, U.S. Income Tax Return of a Foreign Sales Corporation;
  5. 1120-H, U.S. Income Tax Return for Homeowners Associations;
  6. 1120-L, U.S. Life Insurance Company Income Tax Return;
  7. 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons;
  8. 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return;
  9. 1120-POL, U.S. Income Tax Return for Certain Political Organizations;
  10. 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts;
  11. 1120-RIC, U.S. Income Tax Return for Regulated Investment Companies;
  12. 1120-S, U.S. Income Tax Return for an S Corporation; and
  13. 1120-SF, U.S. Income Tax Return for Settlement Funds (Under Section 468B).

July 15 Deferral: Partnership Tax Returns

Notice 2020-23 applies to the following types of partnership calendar-year and fiscal-year tax returns:

  1. Form 1065, U.S. Return of Partnership Income; and
  2. Form 1066, U.S. Real Estate Mortgage Investment Conduit (REMIC) Income Tax Return.

July 15 Deferral: Estate, Gift and Trust Tax Returns

Notice 2020-23 applies to the following types of estate, gift and trust tax returns (including all tax payments required to be made under these returns):

  1. Form 1041, U.S. Income Tax Return for Estates and Trusts;
  2. 1041-N, U.S. Income Tax Return for Electing Alaska Native Settlement Trusts;
  3. 1041-QFT, U.S. Income Tax Return for Qualified Funeral Trusts;
  4. Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return (for estate of a citizen or resident of the United States), including for filings pursuant to Revenue Procedure 2017-34;
  5. 706-NA, United States Estate (and Generation-Skipping Transfer) Tax Return (for estate of a nonresident not a citizen of the United States);
  6. 706-A, United States Additional Estate Tax Return;
  7. 706-QDT, U.S. Estate Tax Return for Qualified Domestic Trusts;
  8. 706-GS(T), Generation-Skipping Transfer Tax Return for Terminations;
  9. 706-GS(D), Generation-Skipping Transfer Tax Return for Distributions;
  10. 706-GS(D-1), Notification of Distribution from a Generation-Skipping Trust (including the due date for providing such form to a beneficiary);
  11. Form 8971, Information Regarding Beneficiaries Acquiring Property from a Decedent and any supplemental Form 8971, including all requirements contained in section 6035(a) of the Code; and
  12. Estate tax payments of principal or interest due as a result of an election made under sections 6166, 6161, or 6163 and annual recertification requirements under section 6166 of the Code.

July 15 Deferral: Tax-Exempt Tax Returns

Notice 2020-23 applies to Form 990-T, Exempt Organization Business Income Tax Return (and proxy tax under section 6033(e) of the Code).

July 15 Deferral: Excise Taxes

Notice 2020-23 applies to excise tax payments on investment income and return filings on Form 990-PF, Return of Private Foundation or Section 4947(a)(1) Trust Treated as Private Foundation as well as excise tax payments and return filings on Form 4720, Return of Certain Excise Taxes under Chapters 41 and 42 of the Internal Revenue Code.

July 15 Deferral: Quarterly Estimated Tax Payments

Notice 2020-23 applies to various types of quarterly estimated income tax payments calculated on or submitted with the following forms:

  1. 990-W, Estimated Tax on Unrelated Business Taxable Income for Tax-Exempt Organizations,
  2. 1040-ES, Estimated Tax for Individuals;
  3. 1040-ES (NR), U.S. Estimated Tax for Nonresident Alien Individuals;
  4. 1040-ES (PR), Estimated Federal Tax on Self Employment Income and on Household Employees (Residents of Puerto Rico);
  5. 1041-ES, Estimated Income Tax for Estates; and Trusts; and
  6. 1120-W, Estimated Tax for Corporations.

July 15 Deferral: Certain Other Affected Taxpayers and Elections; Tax Court Deadlines

Notice 2020-23 also applies to any person performing a time-sensitive action listed in either § 301.7508A-1(c)(1)(iv) – (vi) of the Procedure and Administration Regulations or Revenue Procedure 2018-58, 2018-50 IRB 990 (December 10, 2018), which is due to be performed on or after April 1, 2020, and before July 15, 2020 (“Specified Time-Sensitive Action”). For purposes of this notice, the term Specified Time-Sensitive Action also includes an investment at the election of a taxpayer due to be made during the 180-day period described in the IRS §1400Z-2(a)(1)(A).

Affected Taxpayers also have until July 15, 2020, to perform all Specified Time-Sensitive Actions, that are due to be performed on or after April 1, 2020, and before July 15, 2020. This relief includes the time for filing all petitions with the Tax Court, or for review of a decision rendered by the Tax Court, filing a claim for credit or refund of any tax, and bringing suit upon a claim for credit or refund of any tax. This notice does not provide relief for the time period for filing a petition with the Tax Court, or for filing a claim or bringing a suit for credit or refund if that period expired before April 1, 2020.

July 15 Deferral: Schedules, Elections and Other Forms

Notice 2020-23 applies not only to the aforementioned forms (hereinafter “Specified Forms), but also to schedules, returns, and other forms that are filed as attachments to the Specified Forms or are required to be filed by the due date of the Specified Forms. For example, this affects Schedule H and Schedule SE.

Moreover, elections that are made or required to be made on a timely filed Specified Form (or attachment to a Specified Form) shall be timely made if filed on such Specified Form or attachment, as appropriate, on or before July 15, 2020

July 15 Deferral: International Information Returns and 965 Tax Payments

Notice 2020-23 applies to all US international information returns including forms 3520, 5471, 5472, 8621 (including PFIC elections), 8858, 8865, and 8938. Furthermore, the Notice applies to installment payments under section 965(h) due on or after April 1, 2020, and before July 15, 2020.

This is highly important to Sherayzen Law Office clients’ because almost all of our clients must file these forms and many are required to make 965 installment tax payments.

July 15 Deferral: 2016 Unclaimed Refunds

For 2016 tax returns, the normal April 15 deadline to claim a refund has also been extended to July 15, 2020. The law provides a three-year window of opportunity to claim a refund. If taxpayers do not file a return within three years, the money becomes property of the U.S. Treasury. Notice 2020-23 requires taxpayers to properly address, mail and ensure the tax return is postmarked by the July 15, 2020, date.

July 15 Deferral: IRS Audits, IRS Appeals and Amended Tax Returns

Notice 2020-23 provides a 30-day postponement for “Affected Taxpayers” with respect to “Time-Sensitive IRS Actions” if the last date for performance of the action is on or after April 6, 2020, and before July 15, 2020.

Notice 2020-23 defines “Affected Taxpayers” as:

  1. Persons who are currently under examination (including an investigation to determine liability for an assessable penalty under subchapter B of Chapter 68);
  2. Persons whose cases are with the Independent Office of Appeals; and
  3. Persons who, during the period beginning on or after April 6, 2020 and ending before July 15, 2020, file written documents described in section 6501(c)(7) of the Code (amended returns) or submit payments with respect to a tax for which the time for assessment would otherwise expire during this period.

Notice 2020-23 defines “Time Sensitive IRS Action” as actions described in § 301.7508A-1(c)(2).

July 15 Deferral: Extension of time to file beyond July 15

It is still possible to request an extension of time beyond July 15, 2020 (to October 15, 2020). In order to do it, individual taxpayers must file Form 4868 and business taxpayers must file Form 7004. Both forms should be filed by July 15, 2020.

Taxpayers should keep in mind that an extension to file is not an extension to pay taxes. Taxpayers must estimated their tax liability and pay any taxes owed by July 15, 2020, even if they request an extension to file forms.

New July 15 Deadline for 2019 Tax Compliance | International Tax News

On March 21, 2020, the IRS moved the federal income tax filing and tax payment due date from April 15, 2020, to July 15, 2020. Let’s discuss the new July 15 deadline in more detail.

July 15 Deadline: Why the IRS Moved the Tax Deadline to July 15, 2020?

The IRS moved the deadline because of the huge logistical problems that have arisen as a result of the spread of the coronavirus pandemic in the United States. The coronavirus panic as well as the imposition of what can be described as curfew and other restrictive safety measures in many states have dramatically reduced the ability of tax professionals to effectively and timely help their clients.

It would have been unfair and unreasonable to require taxpayers to file their tax returns by April 15 during this unprecedented national crisis. Hence, President Trump and the IRS decided to prevent this injustice and moved the tax filing and tax payment deadlines to July 15, 2020. This was the right move to make and it is applauded by tax professionals around the country.

The legal authority for the deferral of the April 15 deadline came from President Trump’s emergency declaration last week pursuant to the Stafford Act. The Stafford Act (enacted in 1988) is a federal law designed to bring an orderly and systematic means of federal natural disaster and emergency assistance for state and local governments in carrying out their responsibilities to aid citizens.

July 15 Deadline: What Returns Are Affected?

The deferment of the April 15 deadline applies to all taxpayers – individuals, corporations, trusts, estates and other non-corporate filers, including those who pay self-employment tax. In other words, all Forms 1040, 1041, 1120, et cetera are now due on July 15.

All international information returns which are filed separately or together with the income tax returns are also now due on July 15, 2020. This includes FBAR, Forms 8938, 3520, 5471, 5472, 8865 and other US international information returns.

July 15 Deadline: When are the Tax Payments Due?

All tax payments which are generally due on April 15 are now due on July 15, 2020.

July 15 Deadline: Do I Need to Do Anything Else to Obtain Tax Return Deferral?

Taxpayers do not need to file any additional forms or call the IRS to qualify for this federal tax filing and payment relief. This deferral to July 15, 2020, automatically applies to all of the aforementioned taxpayers.

July 15 Deadline: Is Extension to October Still Possible?

This automatic deferral does not affect the ability of taxpayers to request extension of the July 15 deadline to October 15. Individuals will need to file a Form 4868 in order to request such an extension. Businesses will need to file a Form 7004 to request this extension.

July 15 Deadline: Can I file Before July 15, 2020?

Taxpayers can still file their tax returns prior to July 15, 2020. The IRS promises to issue most refunds within 21 days if returns are e-filed.

New IRS Updates Possible

The IRS will continue to monitor issues related to the COVID-19 virus. New updates will be posted on a special coronavirus page on IRS.gov.

Contact Sherayzen Law Office for Professional Help With Your US International Tax Compliance

The extended July 15 deadline is especially welcome for US taxpayers with foreign assets. The delays caused by coronavirus now become irrelevant and there is plenty of time to finalize both, 2019 US international tax compliance forms and offshore voluntary disclosures.

If you have undisclosed foreign assets and foreign income, contact Sherayzen Law Office for professional assistance. We have successfully helped hundreds of US taxpayers around the world to bring their US tax affairs into full compliance with US tax laws, and we can help you!

Contact Us Today to Schedule Your Confidential Consultation!