On March 13, 2018, the IRS announced that on September 28, 2018, it would end the offshore voluntary disclosure program (OVDP), as it had only attracted 600 applicants in 2017. So now is a good time to take a step back to review the program in the broader context of the research on tax amnesties.
Settlement programs and other voluntary disclosure or correction programs generally offer some form of amnesty. Offering broad tax amnesties on a regular basis, as many states do, can erode voluntary compliance. Read More
American citizens and residents often have placed funds in “foreign bank accounts” in banks all over the world. There is a requirement that all of these foreign bank accounts be reported to the United States on an annual basis and that United States income taxes be paid on all of these bank deposit funds.
Many American taxpayers who have been unaware of this requirement are now being pursued for taxes and penalties for not reporting their foreign bank deposits. There are two Internal Revenue procedures that will permit American taxpayers, who have not properly reported their foreign bank deposits, and the income therefrom, to come forward and report their foreign bank deposits. This avoids significant fines and penalties on a United State taxpayer who has not reported foreign bank deposits. Read More
Fair Tax Competition: The country should not have harmful tax regimes, which go against the principles of the EU’s Code of Conduct or OECD’s Forum on Harmful Tax Practices. Those that choose to have no or zero-rate corporate taxation should ensure that this does not encourage artificial offshore structures without real economic activity. In the context of the screening process, the Code of Conduct Group invited each jurisdiction where concerns were identified to commit to address such concerns. The large majority of jurisdictions have decided to introduce the relevant changes in their tax legislation in order to comply with the EU screening criteria. The following jurisdictions are committed to addressing the concerns relating to economic substance by 2018: Bermuda; Cayman Islands; Guernsey; Isle of Man; Jersey; and Vanuatu.
A quick reminder about sending investment portfolios offshore.
The U.S. taxes residents on worldwide income. From the Treasury Regulations:
In general, all citizens of the United States, wherever resident, and all resident alien individuals are liable to the income taxes imposed by the Code whether the income is received from sources within or without the United States.
There is a lot of attention these days on big companies (Apple, Google, General Electric, Facebook and others) stashing their earnings overseas in what are considered tax havens to avoid paying U.S. taxes on their corporate income. Some international tax reform proposals have been suggested as to how to get the corporation to either bring this stash back into the U.S. by way of a “repatriation holiday” or “deemed repatriation” or ending the system of tax deferrals. Read More
We posted 144 Offshore Banks & Now Financial Advisors Are Turning Over Your Names To The IRS where we discussed the Government has added 47 more banks and financial advisors to this list bringing the number to 144 total banks and foreign financial advisors. Included in this list as #137 is Stefan Buck (effective 11/15/16).
As part of continuing efforts to boost transparency by multinational enterprises (MNEs), Brazil, Guernsey, Jersey, the Isle of Man and Latvia signed today the Multilateral Competent Authority Agreement (MCAA) for the automatic exchange of Country-by-Country reports, bringing the total number of signatories to 49. This marks a further milestone towards the implementation of the OECD/G20 BEPS Project and a significant increase in cross-border cooperation on tax matters.
On May 26, 2016 we posted 97 Offshore Banks Are Turning Over Your Names To The IRS – What Are Your Waiting For? and since then, the Government has added 47 more banks and financial advisors to this list bringing the number to 144 offshore banks and foreign financial advisors. The IRS keeps updating its list of foreign banks which are turning over the names of their U.S. Account Holders, who are now subject to a 50% (rather than 27.5%) penalty in the IRS’s Offshore Voluntary Disclosure Program (OVDP). This penalty is based on the highest account balance measured over up to eight years.
Today, the Minister for Finance Michael Noonan T.D. delivered Budget 2017.
Until the Brexit negotiations begin, it is impossible to know the impact for Ireland. However today’s budget gave Minister Noonan the opportunity to affirm the stability of Ireland’s tax policies while at the same time introducing measures to promote economic growth.