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 St. Paul, Minnesota. This series is devoted to offshore voluntary disclosures. In the previous vlog, I discussed Streamlined Domestic Offshore Procedures and in particular, the factors in both the SDOP eligibility and I mentioned that one of the most important factors is non-willfulness. Non-willfulness with respect to your income tax non-compliance, non-willfulness with respect to your noncompliance with various US information tax returns.
Today, I would like to discuss this topic of non-willfulness because it is very important in understanding whether you’re eligible or not to participate in the SDOP.
What is non-willfulness? Non-willfulness is basically the lack of willfulness, meaning if you’re not willful, you are non-willful. Outside of the voluntary disclosure, the burden of proof to establish willfulness falls on the IRS. Inside of the voluntary disclosure, the burden of proof shifts on you to prove and establish non-willfulness.
If you want to discuss and understand what non-willfulness is, we have to establish what willfulness is in the first place. Willfulness is an intentional or reckless disregard of a known duty. When we are talking about FBAR noncompliance, for example, if the taxpayer knows about the FBAR requirement, but chooses intentionally not to file his FBAR, this can mean only one thing: that he intentionally decided not to comply with this requirement. At this point, in this spectrum, the possibility of willfulness arises. If the taxpayer negligently did not file an FBAR, that would be non-willfulness under the SDOP rules. If the taxpayer did not know about the FBAR, although it’s really difficult to be willful when you don’t know about something, unless you’re reckless in your noncompliance. One of the best examples of recklessness is willful blindness. You close your eyes, you close your ears. ‘I don’t want to see anything; I don’t want to know anything; I don’t want to hear anything’ etcetera; you are intentionally closing off all possible venues for learning about your US international tax reporting requirements.
Non-willfulness is basically the absence of willfulness as I had said and there are various non-willfulness factors that indicate that lack of willfulness. For example, a taxpayer indicates on Schedule B that he has foreign accounts but fails to file an FBAR. If you indicate that you have foreign accounts, that’s already a disclosure of some type. That is possibly a non-willfulness factor. If the taxpayer reports all foreign income but does not report the assets, that is a non-willfulness factor.
The complexity of the form is taken into account in the determination of non-willfulness. For example, if we’re talking about the FBAR reporting which is a more known requirement versus a form 3520 for reporting an inheritance. That is a relatively unknown requirement. A person’s education, work history, obviously if the person is a CPA, for him it’s going to be much harder to establish non-willfulness than it would be for a person who is a carpenter.
A person who is a professional with great financial means is going to have a harder time establishing non-willfulness verses a person who has more limited means. A person who received education in accounting or law will have greater difficulty establishing non-willfulness than someone who does not have that kind of exposure. Even a person with exposure to general reporting, general business law or standards might be in the more difficult position. For example, someone who has an MBA, will have and be in a more difficult position than someone who does not. In other words, non-willfulness is an absence of willfulness and there is a huge number of factors that may support or damage the case for non-willfulness. This is why it is very important to explore your client’s case in depth. This is why I request copies of the resume’, copies of education history, work history, where and how many countries the person lived in, whether it was a territorial jurisdiction or whether was it a jurisdiction that requires worldwide income tax compliance – all of these are factors.
If you would like to learn more whether your noncompliance was non-willful, you can call me at (952) 500-8159 or you can email me at [email protected]
Thank you for watching, until the next time.
http://sherayzenlaw.com/wp-content/uploads/2018/01/sherlawltd_logo.png00adminhttp://sherayzenlaw.com/wp-content/uploads/2018/01/sherlawltd_logo.pngadmin2026-02-04 21:24:372026-02-04 21:42:08Non-Willfulness for Streamlined Disclosure: SDOP & SFOP | International Tax Lawyer Minnesota
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 Minnesota, more precisely, the capital of Minnesota, St. Paul.
As I have previously mentioned, SDOP is one of the major offshore voluntary disclosures options that affect a large number of US taxpayers who wish to bring themselves into full compliance with US international tax laws. The question of eligibility is critical to them.
Let’s dig into the details. First, you must be a US taxpayer which really means US tax resident, either US citizen, Us permanent resident or a person who satisfied the substantial presence test, plus a couple of smaller categories. Second, you must be in violation of US international tax compliance obligations. This is logical, if you’re not in violation of any US international tax compliance obligations why would you do a streamlined domestic offshore procedures? Third, and this is an important one, because this is where a lot of people become ineligible. You must have filed all of the original tax returns included in your offshore voluntary disclosure period. Under the terms of the SDOP, you can only amend a return; you cannot file an original return and fourth, you must be non-willful with respect to all aspects of your US international tax non-compliance. When I say all, I really mean all including US information returns such as FBAR, Form 8938, Form 3520, Form 5471, etcetera and non-reporting of foreign income.
http://sherayzenlaw.com/wp-content/uploads/2018/01/sherlawltd_logo.png00adminhttp://sherayzenlaw.com/wp-content/uploads/2018/01/sherlawltd_logo.pngadmin2025-12-22 20:04:162025-12-29 21:19:52Streamlined Domestic Offshore Procedures Eligibility | SDOP International Tax Lawyer St Paul MN
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 St. Paul, Minnesota. This vlog is devoted to Offshore Voluntary Disclosures.
In the previous vlog, I discussed the issue of the SDOP eligibility and I mentioned that one of the main factors is non-willfulness. In fact, this is the key, the heart of the Streamlined disclosure whether it’s domestic or foreign, in fact. It’s the issue of non-willfulness. You can only participate in the Streamlined Domestic Offshore Procedures if you can establish non-willfulness. If you cannot, you should not be participating in this program and even less so, signing up for form 14654 under the penalty of perjury, you believe you were non-willful, if you believe you were not. That’s very important.
What is non-willfulness? The short answer is that this is an opposite of willfulness – not a very instructive answer if you don’t know what non-willfulness is. Let’s discuss what willfulness is first. Willfulness is an intentional or a reckless disregard of a known duty.
For example, if you know that you need to file an FBAR and you intentionally choose not to file it, the IRS may have the argument for willfulness. If you close your eyes and ears and say, ‘I don’t want to hear anything, I don’t want to see anything, that’s it, I want to be in complete ignorance’. This is called willful blindness. Willful blindness is a form of recklessness and recklessness is a form of willfulness.
Outside of the voluntary disclosure, the IRS has the ‘burden of proof’ to establish willfulness. In the voluntary disclosure, you have the ‘burden of proof’ to establish non-willfulness.
What does it mean? It means potentially that say you participate in a voluntary disclosure program, in the Streamlined Domestic Offshore Procedures and this SDOP submission is later audited and the IRS disagrees that you’ve established the case for non-willfulness, this does not automatically mean that you were willful because once they kick you out of the program, this means that the IRS will have the ‘burden of proof‘ to establish willfulness. This is a fine distinction. Sometimes it doesn’t matter; sometimes it may make a huge difference to the entire case.
Willfulness is the opposite of non-willfulness and non-willfulness is not willfulness, seems very logical and simple but as I had just said, you have to establish non-willfulness. How do you do that? You do that based on the number of factors and arguments.
For example, you take a look at the history of your client. For example, if the client finished law school, is an international tax attorney and does not file an FBAR, while the issue of non-willfulness is going to be really difficult to establish if he did it intentionally. Similiarly, if it is a CPA, same story, it’s going to be much harder for the CPA to establish non-willfulness than it would be, for say a carpenter.
This is an example of one factor; there are a lot of them. The factors include education, work history, financial means (meaning financial means to secure professional help), the time that it took you to realize that you were non-compliant, that is the length of your non-compliance and many, many other factors.
The job of establishing non-willfulness is for an international tax attorney to do. I would strongly recommend that it would be an attorney who would draft your non-willfulness statement that you will submit as part of your SDOP package to the IRS because otherwise, you may unintentionally open a can of worms that could lead to a fishing expedition by the IRS if they think you do not have a solid case for non-willfulness simply because of the way you presented the facts of your case, not necessarily because you were willful but because you created a doubt in the mind of the IRS that you were non-willful. They will start thinking that maybe they should audit your case. Even if you end up in this situation, proving that you were non-willful, you will have by your incorrect non-willfulness statement, raised the chance of a follow-up audit.
If you would like to learn more about non-willfulness and whether your international tax compliance was non-willful, you can call me at (952) 500-8159 or you can email me at [email protected]
| 
Non-Willfulness for Streamlined Disclosure: SDOP & SFOP | International Tax Lawyer Minnesota
/in International tax attorney & lawyer Video /by adminHello 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 St. Paul, Minnesota. This series is devoted to offshore voluntary disclosures. In the previous vlog, I discussed Streamlined Domestic Offshore Procedures and in particular, the factors in both the SDOP eligibility and I mentioned that one of the most important factors is non-willfulness. Non-willfulness with respect to your income tax non-compliance, non-willfulness with respect to your noncompliance with various US information tax returns.
Today, I would like to discuss this topic of non-willfulness because it is very important in understanding whether you’re eligible or not to participate in the SDOP.
What is non-willfulness? Non-willfulness is basically the lack of willfulness, meaning if you’re not willful, you are non-willful. Outside of the voluntary disclosure, the burden of proof to establish willfulness falls on the IRS. Inside of the voluntary disclosure, the burden of proof shifts on you to prove and establish non-willfulness.
If you want to discuss and understand what non-willfulness is, we have to establish what willfulness is in the first place. Willfulness is an intentional or reckless disregard of a known duty. When we are talking about FBAR noncompliance, for example, if the taxpayer knows about the FBAR requirement, but chooses intentionally not to file his FBAR, this can mean only one thing: that he intentionally decided not to comply with this requirement. At this point, in this spectrum, the possibility of willfulness arises. If the taxpayer negligently did not file an FBAR, that would be non-willfulness under the SDOP rules. If the taxpayer did not know about the FBAR, although it’s really difficult to be willful when you don’t know about something, unless you’re reckless in your noncompliance. One of the best examples of recklessness is willful blindness. You close your eyes, you close your ears. ‘I don’t want to see anything; I don’t want to know anything; I don’t want to hear anything’ etcetera; you are intentionally closing off all possible venues for learning about your US international tax reporting requirements.
Non-willfulness is basically the absence of willfulness as I had said and there are various non-willfulness factors that indicate that lack of willfulness. For example, a taxpayer indicates on Schedule B that he has foreign accounts but fails to file an FBAR. If you indicate that you have foreign accounts, that’s already a disclosure of some type. That is possibly a non-willfulness factor. If the taxpayer reports all foreign income but does not report the assets, that is a non-willfulness factor.
The complexity of the form is taken into account in the determination of non-willfulness. For example, if we’re talking about the FBAR reporting which is a more known requirement versus a form 3520 for reporting an inheritance. That is a relatively unknown requirement. A person’s education, work history, obviously if the person is a CPA, for him it’s going to be much harder to establish non-willfulness than it would be for a person who is a carpenter.
A person who is a professional with great financial means is going to have a harder time establishing non-willfulness verses a person who has more limited means. A person who received education in accounting or law will have greater difficulty establishing non-willfulness than someone who does not have that kind of exposure. Even a person with exposure to general reporting, general business law or standards might be in the more difficult position. For example, someone who has an MBA, will have and be in a more difficult position than someone who does not. In other words, non-willfulness is an absence of willfulness and there is a huge number of factors that may support or damage the case for non-willfulness. This is why it is very important to explore your client’s case in depth. This is why I request copies of the resume’, copies of education history, work history, where and how many countries the person lived in, whether it was a territorial jurisdiction or whether was it a jurisdiction that requires worldwide income tax compliance – all of these are factors.
If you would like to learn more whether your noncompliance was non-willful, you can call me at (952) 500-8159 or you can email me at [email protected]
Thank you for watching, until the next time.
Streamlined Domestic Offshore Procedures Eligibility | SDOP International Tax Lawyer St Paul MN
/in International tax attorney & lawyer Video /by adminHello 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 Minnesota, more precisely, the capital of Minnesota, St. Paul.
As I have previously said, this series is devoted to offshore voluntary disclosures and today, I would like to discuss the very important subject of streamlined domestic offshore procedures or SDOP eligibility.
As I have previously mentioned, SDOP is one of the major offshore voluntary disclosures options that affect a large number of US taxpayers who wish to bring themselves into full compliance with US international tax laws. The question of eligibility is critical to them.
Let’s dig into the details. First, you must be a US taxpayer which really means US tax resident, either US citizen, Us permanent resident or a person who satisfied the substantial presence test, plus a couple of smaller categories. Second, you must be in violation of US international tax compliance obligations. This is logical, if you’re not in violation of any US international tax compliance obligations why would you do a streamlined domestic offshore procedures? Third, and this is an important one, because this is where a lot of people become ineligible. You must have filed all of the original tax returns included in your offshore voluntary disclosure period. Under the terms of the SDOP, you can only amend a return; you cannot file an original return and fourth, you must be non-willful with respect to all aspects of your US international tax non-compliance. When I say all, I really mean all including US information returns such as FBAR, Form 8938, Form 3520, Form 5471, etcetera and non-reporting of foreign income.
If you would to learn more about Streamlined Domestic Offshore Procedures and how it may benefit you to participate in this offshore voluntary disclosure option, you can call me at (952) 500-8159 or you can email me at [email protected]
Thank you for watching, until the next time.
Non-Willfulness vs. Willfulness | Streamlined Domestic Offshore Procedures Attorney Minnesota
/in International tax attorney & lawyer Video /by adminHello 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 St. Paul, Minnesota. This vlog is devoted to Offshore Voluntary Disclosures.
In the previous vlog, I discussed the issue of the SDOP eligibility and I mentioned that one of the main factors is non-willfulness. In fact, this is the key, the heart of the Streamlined disclosure whether it’s domestic or foreign, in fact. It’s the issue of non-willfulness. You can only participate in the Streamlined Domestic Offshore Procedures if you can establish non-willfulness. If you cannot, you should not be participating in this program and even less so, signing up for form 14654 under the penalty of perjury, you believe you were non-willful, if you believe you were not. That’s very important.
What is non-willfulness? The short answer is that this is an opposite of willfulness – not a very instructive answer if you don’t know what non-willfulness is. Let’s discuss what willfulness is first. Willfulness is an intentional or a reckless disregard of a known duty.
For example, if you know that you need to file an FBAR and you intentionally choose not to file it, the IRS may have the argument for willfulness. If you close your eyes and ears and say, ‘I don’t want to hear anything, I don’t want to see anything, that’s it, I want to be in complete ignorance’. This is called willful blindness. Willful blindness is a form of recklessness and recklessness is a form of willfulness.
Outside of the voluntary disclosure, the IRS has the ‘burden of proof’ to establish willfulness. In the voluntary disclosure, you have the ‘burden of proof’ to establish non-willfulness.
What does it mean? It means potentially that say you participate in a voluntary disclosure program, in the Streamlined Domestic Offshore Procedures and this SDOP submission is later audited and the IRS disagrees that you’ve established the case for non-willfulness, this does not automatically mean that you were willful because once they kick you out of the program, this means that the IRS will have the ‘burden of proof‘ to establish willfulness. This is a fine distinction. Sometimes it doesn’t matter; sometimes it may make a huge difference to the entire case.
Willfulness is the opposite of non-willfulness and non-willfulness is not willfulness, seems very logical and simple but as I had just said, you have to establish non-willfulness. How do you do that? You do that based on the number of factors and arguments.
For example, you take a look at the history of your client. For example, if the client finished law school, is an international tax attorney and does not file an FBAR, while the issue of non-willfulness is going to be really difficult to establish if he did it intentionally. Similiarly, if it is a CPA, same story, it’s going to be much harder for the CPA to establish non-willfulness than it would be, for say a carpenter.
This is an example of one factor; there are a lot of them. The factors include education, work history, financial means (meaning financial means to secure professional help), the time that it took you to realize that you were non-compliant, that is the length of your non-compliance and many, many other factors.
The job of establishing non-willfulness is for an international tax attorney to do. I would strongly recommend that it would be an attorney who would draft your non-willfulness statement that you will submit as part of your SDOP package to the IRS because otherwise, you may unintentionally open a can of worms that could lead to a fishing expedition by the IRS if they think you do not have a solid case for non-willfulness simply because of the way you presented the facts of your case, not necessarily because you were willful but because you created a doubt in the mind of the IRS that you were non-willful. They will start thinking that maybe they should audit your case. Even if you end up in this situation, proving that you were non-willful, you will have by your incorrect non-willfulness statement, raised the chance of a follow-up audit.
If you would like to learn more about non-willfulness and whether your international tax compliance was non-willful, you can call me at (952) 500-8159 or you can email me at [email protected]
Thank you for watching, until the next time.