Why shouldn’t every US taxpayer with offshore accounts or assets choose the Streamlined Domestic Offshore Procedures when coming into compliance with the IRS and FBAR reporting requirements under FATCA? Why wouldn’t a US taxpayer simply want to claim “non-willful” conduct in their disclosures of offshore bank accounts, investments and assets and pay the minimal 5% penalty?
Risk. Pure and Simple. Substantial Risk.
This decision comes down to the conduct of the US Taxpayer and whether or not the IRS will identify the associated behavior as “willful” or “non-willful.” In the balance is a substantial amount of money, as well as criminal prosecution and a three to five year jail sentence for tax evasion.
Consider the Texas case of Bernhard Gubser. The IRS has denied his application under the Streamlined Domestic Offshore Procedures, and is pursuing him for maximum penalties as well as criminal tax evasion charges. Mr. Gubser is suing the IRS claiming that his failure to disclose assets in a single Swiss bank account in 2008 was an error. The IRS is fighting him after issuing a notification of “willful” conduct in his case.
The difference for Mr. Gubser: $10,000 vs $1.35 Million
If you have not yet come into compliance with the IRS regarding offshore bank accounts, investments and assets you should give serious consideration to this case. Mr. Gubser ommitted one account in one tax year. This did not qualify as “non-willful” activity in the eyes of the IRS. Therefore, filing under the Streamlined Domestic Offshore Procedures may assume huge financial and criminal risks.
Would the OVDP prove to be a safer and sound financial decision carrying far less risk?
These decisions must be taken aftern careful consideration. We invite you to contact the experienced tax attorneys at Allen Barron for a free consultation at 866-631-3470 today. Learn about the requirements to come into full compliance with the IRS, and receive the protections of the attorney-client privilege.
What is your appetite for risk?
