Yearly Archives: 2018

On February 7, 2017 we posted IRS Has 13 New Compliance Campaigns for LB&I Taxpayers where we discussed our previous posted on October 9, 2015 LB&I Agents Lose Autonomy To Centralized Office That Will Be Using Data to Identify Compliance Risks For Audit! that discussed the fact that Tax practitioners will face new questions from examination teams as the IRS selects compliance risks based on data.   

This is in conformity with the Large Business and International Division's (LB&I) move from individual audits of multinationals to broader considerations involving risk assessment, which was included in January 2017 announcement regarding the new audit strategy for its LB&I division known as "campaigns," essentially, shifting its strategy toward issue-based examinations based on compliance issues that LB&I determines present greater levels of compliance risk and thereby improving return selection. IRS initially selected 13 compliance issues when it rolled out this strategy.

The six campaigns selected for this rollout are:

• 1. Interest Capitalization for Self-Constructed Assets

• 2. F3520/3520-A Non-Compliance/Assessed Penalties  

• 3. Forms 1042/1042-S Compliance

Taxpayers who make payments of certain U.S.-source income to foreign persons must comply with the related withholding, deposit, and reporting requirements. This campaign addresses Withholding Agents who make such payments but do not meet all their compliance duties. The Internal Revenue Service will address noncompliance and errors through a variety of treatment streams, including examination.

 
• 4. Nonresident Alien Tax Treaty Exemptions

• 5. Nonresident Alien Schedule A and Other Deductions

• 6. NRA Tax Credits

This campaign is intended to increase compliance in nonresident alien individual (NRA) tax credits. NRAs who either have no qualifying earned income, do not provide substantiation/proper documentation, or do not have qualifying dependents may erroneously claim certain dependent related tax credits. In addition, some NRA taxpayers may also claim education credits (which are only available to U.S. persons) by improperly filing Form 1040 tax returns. This campaign will address noncompliance through a variety of treatment streams including outreach/education and traditional examinations.

International Tax Audit by IRS LB&I ?
 

 
Contact the Tax Lawyers at
Marini & Associates, P.A.
 

 
 for a FREE Tax Consultation Contact US at
www.TaxAid.com or www.OVDPLaw.com
or Toll Free at 888-8TaxAid (888 882-9243).
 

 


According to National Bureau of Economic Research (NBER) there is over ARS220 billion in offshore accounts, the equivalent of almost 40 percent of Argentina’s GDP. The country ranks 5th globally for offshore account deposits, behind Russia, Saudi Arabia, Venezuela and the UAE.

Drawing on newly published macroeconomic statistics, the National Bureau of Economic Research  estimates the amount of household wealth owned by each country in offshore tax havens.

The equivalent of 10% of world GDP is held in tax havens globally, but this average masks a great deal of heterogeneity, from a few percent of GDP in Scandinavia, to about 15% in Continental Europe, and 60% in Gulf countries and some Latin American economies.

NBER used these estimates to construct revised series of top wealth shares in ten countries, which account for close to half of world GDP.

0.01% wealth share substantially, even in countries, such as Norway or Denmark, that do not
use tax havens extensively. Offshore wealth has a larger effect on inequality in the U.K., Spain,
and France, where, by our estimates, 30%–40% of all the wealth of the 0.01% richest households
is held abroad.

It has dramatic implications in Russia, where the majority of wealth at the top is held outside of the country. In the United States, offshore wealth also increases inequality, but the effect is more muted than in Europe, because U.S. top wealth shares are already very high even disregarding tax havens. In all cases, taking offshore wealth into account increases the rise in inequality seen in tax data markedly. This result highlights the importance of looking beyond tax data to study wealth accumulation among the very rich in a globalized world.

These results highlight the importance of looking beyond tax and survey data to study wealth accumulation among the very rich in a globalized world.

Estates and their authorized representatives may request an account transcript by filing Form 4506-T, Request for Transcript of Tax Return. Currently, Form 4506-T can be filed with IRS via mail or facsimile (per the instructions on the form). Although account transcripts for estate tax returns are not currently available through IRS's online Transcript Delivery System (TDS), the IRS website, www.irs.gov, will have current information should an automated method become operational. 
 
To allow time for processing the estate tax return, requests should be made no earlier than four months after filing the estate tax return.
 
IRS says that estates and their authorized representatives who wish to continue to receive estate tax closing letters may call IRS at (866) 699-4083 to request an estate tax closing letter no earlier than four months after the filing of the estate tax return. 
This certainly presents an opportunity to demonstrate how the IRS can create unnecessary complexities (and accompanying misery) for people wishing to receive Federal Closing Letters. Lots of luck!

Have a US Estate Tax Problem?

 

Estate Tax Problems Require

an Experienced Estate Tax Attorney

 

Contact the Tax Lawyers at

Marini & Associates, P.A.

 for a FREE Tax Consultation Contact US at

www.TaxAid.com or www.OVDPLaw.com

or Toll Free at 888-8TaxAid (888 882-9243).
 

------------------------------------------------------------------------------------------- 

Robert S. Blumenfeld  - 

 Estate Tax Counsel

Mr. Blumenfeld concentrates his practice in the areas of International Tax and Estate Planning, Probate Law, and Representation of Resident and Non-Resident Aliens before the IRS.

Prior to joining Marini & Associates, P.A., he spent 32 years as the Senior Attorney with the Internal Revenue Service (IRS), Office of Deputy Commissioner, International.

While with the IRS, he examined approximately 2,000 Estate Tax Returns and litigated various international and tax issues associated with these returns.As a result of his experience, he has extensive knowledge of the issues associated with and the preparation of U.S. Estate Tax Returns for Resident and Non-Resident Aliens, Gift Tax Returns, Form 706QDT and Qualified Domestic Trusts.

The Internal Revenue Service warned in IR-2018-119 of a new twist tied to an old scam aimed at international taxpayers and non-resident aliens. In this scam, criminals use a fake IRS Form W-8BEN to solicit detailed personal identification and bank account information from victims. Here’s how the scam works:

1. Criminals mail or fax a letter indicating that although individuals are exempt from withholding and reporting income tax, they need to authenticate their information by filling out a phony version of Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting. Recipients are requested to fax the information back.
2. The Form W-8BEN is a legitimate U.S. tax exemption document, however, it can only be submitted through a withholding agent.
3. In the past, fraudsters have targeted non-residents of the U.S. using the form as a lure to get personal details such as passport numbers and PIN codes.
4. The legitimate IRS Form W-8BEN does not ask for any of that information.
5. The phony letter or fax also refers to a Form W9095, which does not exist.
6. Furthermore, the IRS doesn’t require a recertification of foreign status.

Scam variations

Be alert to bogus letters, emails and letters that appear to come from the IRS or your tax professional requesting information. Scam letters, forms and e-mails are designed to trick taxpayers into thinking these are official communications from the IRS or others in the tax industry, including tax software companies. These phishing schemes may seek personal information, including mother’s maiden name, passport and account information in order steal the victim’s identity and their assets.

Note that the IRS does not:

• Demand that people use a specific payment method, such as a prepaid debit card, gift card or wire transfer. The IRS will not ask for debit or credit card numbers over the phone. For people who owe taxes, make payments to the United States Treasury or review IRS.gov/payments for IRS online options.  
• Demand immediate tax payment. Normal correspondence is a letter in the mail and taxpayers can appeal or question what they owe. All taxpayers are advised to know their rights as a taxpayer.
• Threaten to bring in local police, immigration officers or other law enforcement to arrest people for not paying. The IRS also cannot revoke a license or immigration status. Threats like these are common tactics scam artists use to trick victims into believing their schemes.

Taxpayers who receive the IRS phone scam or any IRS impersonation scam should report it to the Treasury Inspector General for Tax Administration at its IRS Impersonation Scam Reporting site and to the IRS by emailing [email protected] with the subject line “IRS Impersonation Scam.”