Are you concerned about the high IRS tax rates on a foreign trust? It is important to understand the tax and reporting consequences on this specific type of investment. It may very well be time to evaluate the net value of this form of investment based upon current IRS taxation...
An International Tax Primer for US Taxpayers and Expatriates – Part 1 of 2
Welcome to part 1 of our Allen Barron International Tax Primer for US Taxpayers and Expatriates. The United States is one of the few countries in the world that taxes its citizens on their worldwide income. US taxpayers are required to report all sources of income, worldwide, not just income...
Investment in a Foreign Trust Creates Complex Reporting Requirements
The IRS has clearly identified legitimate reasons why "US Persons" would establish or maintain ownership in a foreign trust. However, there are significant and complex tax reporting requirements associated with US taxpayers who are beneficiaries with an investment in a foreign trust. There are specific transactional reporting requirements for those...
IRS FBAR Audits and Prosecutions Have Begun
The IRS FBAR audits and prosecutions have begun and the clock is ticking for those who have yet to come into full FBAR compliance with the IRS. A Connecticut man recently plead guilty to the offshore scheme he used to conceal income from the IRS. The man, a duty-free importer...
International or Foreign Trusts May Cause More Problems Than They Solve
We have seen several recent examples of people who were convinced to set up international or foreign trusts in order to "shield income and assets" from needless taxation. No, these aren't foreign citizens with foreign interests, they are US taxpayers who have been convinced to open a foreign trust which...
US Justice Department Wins First FATCA Legal Victory – Shell Company and Its Nominees
Last week, the US Justice Department announced its first FATCA Legal Victory when it announced that Gregg R. Mulholland, owner of an offshore investment management company based out of Panama and Belize has plead guilty to money laundering and conspiracy. The firm was accused of fraudulent behavior, manipulating the value of...
FATCA Rules May Make a US Trust Taxable as a Foreign Trust
Is it possible that a trust established under the laws of a US State such as California, with a US agent serving as its trustee could be forced to file taxes as a foreign trust? Yes, Under the Foreign Account Tax Compliance Act or FATCA rules and federal law if...