In previous decades, U.S. residents were able to freely open foreign bank accounts the contents of which largely remained private. However, since the passage of the Report of Foreign Bank and Financial and Foreign Account Tax Compliance Act, U.S. residents with foreign assets are now subject to strict regulations with regard to reporting foreign assets in excess of $10,000.
There's a saying that ignorance is bliss. When it comes to taxes, however, ignorance of applicable tax laws could result in an individual incurring hefty fines, penalties and even criminal charges. Due to the ridiculously complex regulations and requirements that compose the U.S. tax code, tax mistakes are common. It's important to note, however, that the Internal Revenue Service has different ways of discerning whether a tax mistake was indeed just a mistake or something more nefarious.
With tax season now in full swing, IRS employees and tax professionals are not the only people working overtime. This time of year is an especially busy time for tax scam artists, who seemingly make a comfortable living by defrauding the government and taxpayers.
Last month, we wrote about a scandal involving seizures by the IRS of privately held bank accounts and other assets. The agency has been able to seize these assets without a warrant and without criminal charges under a process known as civil asset forfeiture.
Following a number of recent negative press stories, culminating in a front page article in the New York Times, the IRS's Chief of Criminal Investigation just announced that the IRS will no longer pursue the seizure and forfeiture associated with legal source "structuring cases", except under exceptional circumstances. Bills have been introduced in both the Senate and House of Representatives requiring the government's standard of proof in civil forfeiture proceedings to be by "clear and convincing evidence", a much higher standard than presently required. Sen. Chuck Grassley (R-IA) Ranking Member and possibly the new chairman of the Judiciary Committee suggested it was time to reform civil forfeiture laws and procedures.
Many Americans enjoy a steady paycheck directly deposited into their bank account every two weeks or so. If you work for a company as an employee, the company’s payroll department has likely already deducted all necessary payroll taxes, including taxes for Medicare and Social Security.
A frequent complaint about American tax codes is that they are too complicated for the average person to understand. This is why so many Americans choose to hire a professional or company to prepare their tax returns. Working with a professional saves time and often helps shield against mistakes that could lead to an IRS audit.
America’s entertainment industry has long promoted the fantasy that anyone can go from obscurity to celebrity practically overnight. Along with instant fame is also the prospect of instant fortune.