Delinquent US filer disclosures and IRS investigations

It is still common for us to be contacted by “accidental Americans” who were born in the US but have had no connection with the US since, and now find that they have had a US tax filing obligation for years. 
Late tax returns and FBARs

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Effective September 2018, the IRS have officially closed the Offshore Voluntary Disclosure Program (OVDP), which was a voluntary disclosure program designed for taxpayers with exposure to potential criminal liability and/or substantial civil penalties due to a willful failure, to report foreign financial assets and pay all tax due in respect of those assets. However, the IRS are still committed to keeping the Streamlined Filing disclosure facility open for the time being. 

Late US tax returns and Foreign Bank Account Reports (FBARS)

The Streamlined Filing disclosure facility allows US taxpayers to file the last three late US tax returns and last six late FBARS with reduced penalties assuming the non-filing can be shown to be non-wilful.

With the withdrawal of the OVDP, it is our view that the IRS may look to close down or amend the terms of the Streamlined Filing Program in the near future. We therefore strongly advise you to contact us as soon as possible for advice on the IRS guidance on non-wilfulness.

Information returns

Information returns

There are alternative IRS procedures available to get information returns up to date in a penalty-free manner, subject to reasonable cause, for US taxpayers who have reported all of their foreign income on their US returns but have not filed their information returns, such as:

  • Annual Report of Foreign Financial Accounts (FBARS) 
  • Forms 3520 (Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts)
  • Form 5471 (Information Return of US Persons With Respect To Certain Foreign Corporations)
IRS investigations

IRS investigations

If you have already received a notice from the IRS demanding that you make a payment of taxes or penalties, or threatening a lien on your property, you may need to take some urgent action. Our team of experts is very experienced in handling correspondence with the IRS on behalf of our clients. Sometimes it takes persistence to bring an enquiry to a close but we will be able to achieve the best possible outcome for you.

In some cases, it may be advisable to draw on the expertise of a US qualified lawyer in order to determine the best approach and make sure your disclosure is as robust as possible. If so, we can help to find the right legal adviser for you.

Get in touch
Speak to an expert

For more information or advice tailored to your situation please contact Allan or Virginia, or fill out the form below and one of our experts will be in touch. 

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