Posts

New Form 1040-SR for Seniors | US Tax Lawyers & Attorneys

/in , /by

For the very first time, the IRS has created a new tax form called Form “1040-SR”. “SR” here standards for “seniors”. The idea is that the new form will be used by senior taxpayers. Let’s discuss Form 1040-SR in more detail.

Form 1040-SR: Reasons for Its Creation

The reason for the creation of Form 1040-SR was the Bipartisan Budget Act of 2018. The Act obligated the IRS to create a new form for seniors.

Form 1040-SR: Eligibility

Taxpayers born before Jan. 2, 1955 (i.e. those who are 65 years old or older), have the option to file Form 1040-SR whether they are working, not working or retired. Married couples filing a joint return can use the new form regardless of whether one or both spouses are age 65 or older or retired.

Form 1040-SR: Differences from Regular Form 1040

The principal difference between the regular Form 1040 and Form 1040-SR is a larger font and better readability.

Otherwise, all lines and checkboxes on the new form mirror the Form 1040, and both forms use all the same attached schedules and forms. The new form allows income reporting from other sources common to seniors such as investment income, Social Security and distributions from qualified retirement plans, annuities or similar deferred-payment arrangements. Both forms use the same “building block” approach introduced last year that can be supplemented with additional Schedules 1, 2 and 3 as needed.

Many taxpayers with basic tax situations can file Form 1040 or 1040-SR with no additional schedules. However, taxpayers with international tax exposure will most likely need additional schedules.

Seniors can use Form 1040-SR to file their 2019 federal income tax return, which is normally due on April 15, 2020 but has been extended to July 15, 2020 because of the Coronavirus. The revised 2019 Form 1040 Instructions cover both versions of Form 1040.

Seniors With Foreign Assets and Foreign Income Still Need to Comply With US International Tax Requirements

Sherayzen Law Office wishes to warn seniors that using Form 1040-SR does not relieve seniors of their obligation to comply with US international tax reporting requirements concerning their foreign assets and foreign income.

US tax residents must disclose their worldwide income on their US tax returns even if they are filing Form a 1040-SR this year. Similarly, all US international information returns must be filed with the senior version of Form 1040. Finally, foreign accounts must be disclosed not only on FBAR, but also on Schedule B of Form 1040-SR and possibly Form 8938.

If you have undisclosed foreign assets and foreign income for prior years, should contact Sherayzen Law Office for professional help with the offshore voluntary disclosure of your past noncompliance with US international tax reporting requirements. We have successfully helped hundreds of US taxpayers resolve their prior US tax noncompliance issues, and we can help you!

Contact Us Today to Schedule Your Confidential Consultation!

2019 Minsk Seminar: US International Corporate Tax Reform | GILTI & FDII

/in , /by

On August 28, 2019, Mr. Eugene Sherayzen, the owner and founder of Sherayzen Law Office, Ltd, gave a seminar at Minsk City Bar Association (“MCBA”) in Minsk, Belarus. The focus of the seminar was on the 2017 Tax Cuts and Jobs Act (“2017 TCJA” or “2017 tax reform”) changes in the US international corporate tax law. Let’s discuss this 2019 Minsk seminar in more detail.

2019 Minsk Seminar: Organizational Aspects

The 2019 Minsk seminar was held at a location owned by MCBA in Minsk, Belarus. The seminar was well-attended by Minsk lawyers of various specializations, not just tax attorneys. Mr. Sherayzen conducted the seminar in the Russian language.

2019 Minsk Seminar: Structure of the Seminar

The seminar consisted of four parts: introduction to Sherayzen Law Office’s international tax practice, discussion of five important concepts of US international tax law, explanation of certain aspects of US international business tax law prior to the 2017 tax reform and the 2017 TCJA changes to US international corporate tax law. Throughout the seminar, Mr. Sherayzen made certain digressions into individual international tax law as well as general business tax law in order to better explain certain aspects of the 2017 tax reform to the audience.

2019 Minsk Seminar: Sherayzen Law Office International Tax Practice

During the seminar, Mr. Sherayzen introduced his law firm, Sherayzen Law Office, Ltd., to the audience. He explained that the focus of his practice is on US international tax law. After explaining what “US international tax law” meant, the attorney described the four main sub-areas of his practice: offshore voluntary disclosures, IRS international tax audits, annual compliance and international tax planning.

2019 Minsk Seminar: Five Concepts

After describing his practice, Mr. Sherayzen discussed in detail five relevant concepts of US international tax law. He first introduced the concept of “US tax residency” and generally described the categories of US tax residents. In response to a question from an attendee, the attorney distinguished US tax residency from immigration residency.

Then, Mr. Sherayzen discussed the principle of worldwide income taxation of US tax residents. The fact that US tax residents must report their worldwide income even if they reside overseas caused consternation among some attendees.

The discussion of the concept of income recognition resulted in a lively exchange between the speaker and the audience. At that point, Mr. Sherayzen alluded that this topic would be relevant to the his explanation of the anti-deferral regimes during the second part of his lecture.

The rest of this part of the seminar focused on the taxation powers of the US congress and the source of income rules. The attorney introduced certain general source-of-income rules, but warned about the enormous amount of exceptions in this area of law.

2019 Minsk Seminar: Pre-Tax Reform US International Corporate Tax Law

Mr. Sherayzen adopted a general historical approach to the explanation of US international corporate tax law prior to the 2017 TCJA. He commenced with a description of the progression of law since the 1920s, explaining the incentives that existed for the accumulation of cash overseas. Then, the attorney discussed the modifications to the law enacted by Congress throughout the years in order to combat tax avoidance by US corporations.

At that point, Mr. Sherayzen introduced the two main anti-deferral regimes: Subpart F rules and PFIC rules. He explained these regimes in a general manner, warning the audience that there were many specific rules and exceptions to these general rules. The attorney also discussed why these two anti-deferral regimes failed to stop tax avoidance and the continued accumulation of corporate cash in foreign subsidiaries.

2019 Minsk Seminar: 2017 Tax Reform

The discussion of the 2017 TCJA consisted of three parts: (1) reasons for the reform; (2) new rules to combat tax avoidance; and (3) tax incentives with respect to returning production to the United States and exporting from the United States.

After introducing the audience to the historical and political context in which 2017 TCJA was enacted, Mr. Sherayzen discussed the new tax avoidance prevention rules, focusing on the Section 965 tax and Global Intangible Low-Taxed Income (“GILTI”) tax. Then, the attorney explained the new tax incentives introduced by the 2017 tax reform, including lower corporate tax rates, full participation exemption and Foreign-Derived Intangible Income (“FDII”).

2019 Minsk Seminar: Conclusion

At the end of the seminar, there was an extensive Q&A session. Questions ranged from re-classification of shareholder loans during an offshore voluntary disclosure to certain aspect of the 2017 tax reform and its impact on corporate restructuring.

Sherayzen Law Office Ltd | US International Tax Law Firm

/in , /by

Sherayzen Law Office PLLC hereby gives notice that, as of January 1, 2018, its official owner is Sherayzen Law Office, Ltd (“Sherayzen Law Office Ltd”). Sherayzen Law Office Ltd will continue to utilize “Sherayzen Law Office” as its trade name. Furthermore, Sherayzen Law Office Ltd will continue to maintain the disregarded entity (for tax purposes) Sherayzen Law Office PLLC for an indefinite period of time.

This means that Sherayzen Law Office Ltd is the official name of our international tax law firm as of January 1, 2018. Sherayzen Law Office Ltd has assumed all assets, liabilities, rights and duties of Sherayzen Law Office PLLC as of January 1, 2018.

The change in the corporate structure of Sherayzen Law Office occurred for marketing purposes. “PLLC” is a highly specified form of doing business which is not recognized outside of the United States, whereas “Ltd” is a very common form of doing business worldwide.

Sherayzen Law Office Ltd is an international tax law firm owned by attorney Eugene Sherayzen, Esq., who specializes in US international tax law. In particular, Mr. Sherayzen is a leading expert in the area of offshore voluntary disclosures (IRS Offshore Voluntary Disclosure Program (“OVDP”), Streamlined Domestic Offshore Procedures, Streamlined Foreign Offshore Procedures, Delinquent International Information Return Submission Procedures, Delinquent FBAR Submission Procedures, Reasonable Cause Disclosures, et cetera), FATCA compliance (including Form 8938, W8-BEN-E, et cetera), FBAR compliance, international tax compliance (including information returns for the ownership of a foreign business – Forms 5471, 8865, 8858, 926, et cetera), foreign trust US tax compliance (Forms 3520 and 3520-A), foreign inheritance reporting, foreign gift reporting, PFIC compliance (Form 8621), international tax planning and others.

Additionally, Sherayzen Law Office Ltd is helping its clients with domestic tax compliance, IRS audits, appeals to the IRS Office of Appeals and tax litigation.

Sherayzen Law Office Ltd operates worldwide. In fact, since 2005, Sherayzen Law Office has helped hundreds clients from close to 70 countries from every continent: Australia, North America (Canada, Mexico and the United States), South America (Argentina, Brazil, Chile and Colombia), including Central American countries like Barbados, Belize, Costa Rica, Nicaragua and Panama, Africa (Ethiopia, Ivory Coast, Nigeria), the Middle East region of Asia (Egypt, Iraq, Iran, Israel, Kuwait, Lebanon, United Emirates and so on), Southeast Asian countries (China, India, Thailand, et cetera), Far Eastern region of Asia (Japan) and the great majority of European countries (Western, Eastern, Northern and Southern Europe) including Great Britain and Ireland as well as Russia.

Contact Us Today to Schedule Your Confidential Consultation!