The Fourth Circuit Court Rules in Favor of the IRS: US Taxpayers with Undisclosed Offshore Accounts Should Come Into Compliance Now to Secure Set PenaltiesOffshore Updates
Posted in on August 2, 2012
The United States Fourth Circuit Court of Appeals recently issued a ruling against U.S. taxpayer J. Bryan Williams. Williams maintained two undisclosed offshore accounts from 1993 through 2000, when the IRS began its investigation into his foreign assets. The IRS imposed a $200,000 penalty for willful failure to file a Report of Foreign Bank and Financial Accounts (commonly referred to as the FBAR), on his two Swiss accounts.
The Fourth Circuit’s ruling allows the IRS to establish willful failure to file FBARs by the mere fact that the taxpayer signed his income tax returns. The Court determined that once a U.S. taxpayer signs his federal return, he is assumed to understand that he is required to file an FBAR if he maintains any foreign financial assets.
The IRS will likely use the Fourth Circuit’s ruling to their advantage when assessing civil penalties. U.S. taxpayers with undisclosed offshore accounts should enter the IRS’s 2012 Amnesty Program in order to ensure set civil penalties that could otherwise increase dramatically as a result of the Court’s judgment.
The attorneys at Thorn Law Group have experience in assisting U.S. taxpayers into compliance through the IRS Amnesty Program. If you have an undisclosed offshore account contact Thorn Law Group now before it's too late!