To catch tax evaders employing international tax shelters, the United States announced a collaborative effort with the United Kingdom and Australia to share tax information from many international trusts and companies (IR-2013-48, May 9, 2013). If you have international assets and fail to file the proper IRS forms and pay your income taxes, you could be in danger of serious penalties or criminal prosecution. Please contact the international tax consultants at LSL CPAs for your help. The time to take action is now before the axe falls.
International Tax Shelters & Tax Evasion
According to the IRS news release, each of the three participating nations has acquired a substantial amount of data that is being shared. The data uncovers and details the extensive use of tax shelter entities organized in various jurisdictions, including Singapore, the British Virgin Islands, the Cayman Islands, and the Cook Islands. The data contains the identities of the individual owners of the entities, and such information will be the key to future prosecution. In addition, the shared information also reveals the advisors who assisted in establishing these structures as international tax shelters. As a result, if you believe such data could financially hurt you, it is a mistake to use the accountants or lawyers who help set up the tax shelters for you in the first place. You need a new international tax expert on your team.
The IRS, the Australian Taxation Office, and HM Revenue and Customs – the respective tax agencies involved in the collaboration – have been analyzing this data. IRS Acting Commissioner Steven Miller explained, “This is part of a wider effort by the IRS and other tax administrations to pursue international tax evasion… Our cooperative work with the United Kingdom and Australia reflects a bigger goal of leaving no haven for people trying to evade taxes illegally.”
The nature of the IRS’s involvement with the collaboration has yet to be fully revealed. The plan is believed to work in conjunction with the Foreign Account Tax Compliance Act (FATCA). Under FATCA, US taxpayers with specified foreign financial assets exceeding certain thresholds must report those assets to the IRS. The collaborative effort is designed to uncover those individuals who, either purposely or unintentionally, fail to report income worldwide or comply with the necessary filing requirements.
International Tax Consultant Can Help
If you have international assets, it is time to be vigilant regarding tax compliance. You must ensure you have filed all of the proper IRS forms beyond the domestic form 1040. IRS form 1040 alone is insufficient to prevent you from being prosecuted if you have foreign holdings and international tax shelters. The international tax consultants at LSL CPAs specialize in ensuring our clients with foreign holdings comply with the IRS and have correctly filed all the necessary forms. At the same time, we use the best legal tax strategies to help reduce payments and save you money.
Although this content contains the latest information available at the time of the writing, it is inherently limited because of the length of the article and the complexity of the international tax issues at hand. As a result, it presents only a partial view of the subject matter.
