UK/USA Dual Citizen moving to California
Jul 3rd 2012, 2:22 am
#31
Rootbeeraholic
Joined: Aug 2009
Location: Houston, Tx
Posts: 2,280
Re: UK/USA Dual Citizen moving to California
Not sure what value "seeking advice" (from whom?) can add for most people, other than filing the outstanding tax/FBAR returns straight away.
If there is a significant underpayment of U.S. tax then obviously some professional advice is required. Otherwise normally the standing advice is to file the outstanding returns.
http://www.irs.gov/newsroom/article/...250788,00.html
If there is some U.S. tax owed, less than $1,500 per year, then note the recent IRS announcement:
http://www.irs.gov/newsroom/article/...ml?portlet=108
If there is a significant underpayment of U.S. tax then obviously some professional advice is required. Otherwise normally the standing advice is to file the outstanding returns.
http://www.irs.gov/newsroom/article/...250788,00.html
If there is some U.S. tax owed, less than $1,500 per year, then note the recent IRS announcement:
http://www.irs.gov/newsroom/article/...ml?portlet=108
Jul 3rd 2012, 2:28 am
#32
Retired
Joined: Apr 2004
Posts: 34,649
Re: UK/USA Dual Citizen moving to California
The tax return is not the issue. You can back file your tax returns easily enough and if the OP has lived in the UK at the salary level they mention then they are well below the taxable level of $89k or whatever it is these days for someone living outside the US and will owe nothing due to the tax treaty. The IRS is making a point of cracking down on delinquent FBARs and it is the failure to notify the IRS of these accounts that is the concern and they are now starting to pay attention to people trying to do 'quiet' disclosures.
Other than those who (inappropriately, for whatever reason) found themselves in the "voluntary disclosure" scheme, I am not aware of a single reported case of someone being fined for filing an FBAR late without having significantly underpaid tax. Not one.
Last edited by JAJ; Jul 3rd 2012 at 2:31 am.
Jul 3rd 2012, 1:45 pm
#33
Rootbeeraholic
Joined: Aug 2009
Location: Houston, Tx
Posts: 2,280
Re: UK/USA Dual Citizen moving to California
Thousands of people have filed delinquent FBARs at the same time as (or subsequently to) their tax returns without any problem. The IRS is saying that's exactly what most people - who haven't underpaid tax - should do.
Other than those who (inappropriately, for whatever reason) found themselves in the "voluntary disclosure" scheme, I am not aware of a single reported case of someone being fined for filing an FBAR late without having significantly underpaid tax. Not one.
Other than those who (inappropriately, for whatever reason) found themselves in the "voluntary disclosure" scheme, I am not aware of a single reported case of someone being fined for filing an FBAR late without having significantly underpaid tax. Not one.
I'm giving him my personal experience of having gone through this. I spoke to the IRS prior to being entered on the VDP and contrary to the claim above they were adamant that filing the FBAR 'quietly' was not the correct action to take (and I will re-iterate here that I did not owe any tax) and reinforced to me that the penalties for getting caught doing that can be severe. Like I said previously, they have let people get away with it in the past but are starting to crack down on it.
What the OP does is up to them, I am merely highlighting the potential risks involved, the decision on how to play it is up to them.
Jul 3rd 2012, 11:31 pm
#34
Retired
Joined: Apr 2004
Posts: 34,649
Re: UK/USA Dual Citizen moving to California
Thousands of people speed without getting caught, that doesn't mean it's not wrong.
I'm giving him my personal experience of having gone through this. I spoke to the IRS prior to being entered on the VDP and contrary to the claim above they were adamant that filing the FBAR 'quietly' was not the correct action to take (and I will re-iterate here that I did not owe any tax) and reinforced to me that the penalties for getting caught doing that can be severe. Like I said previously, they have let people get away with it in the past but are starting to crack down on it.
I'm giving him my personal experience of having gone through this. I spoke to the IRS prior to being entered on the VDP and contrary to the claim above they were adamant that filing the FBAR 'quietly' was not the correct action to take (and I will re-iterate here that I did not owe any tax) and reinforced to me that the penalties for getting caught doing that can be severe. Like I said previously, they have let people get away with it in the past but are starting to crack down on it.
It's unfortunate that you got caught up in the voluntary disclosure program when you didn't need to be. They even brought in an opt-out facility to deal with people in situations exactly like yours who had been scared into declaring themselves into a program that was (and is) designed for large scale tax cheats.
In general, getting advice over the phone from a government agency is not a good idea.
If tax returns are being back-filed (and that is the expectation), then FBARs should be back-filed at the same time. As long as there isn't significant tax evasion, it normally doesn't need to be made any more complicated than that.
