Yearly Archives: 2020

So far, the IRS has postponed until July 15 federal income tax returns and payments (including self-employment tax payments) due April 15, 2020, for 2019 tax years, and estimated income tax payments due April 15, 2020, for 2020 tax years. The IRS has expanded that postponement to include gift and generation-skipping transfer (GST) taxes and returns. The AICPA has recommended that the IRS should expand relief to all types of returns and payments due between March 3 and July 15.

 

Need to Obtain IRS Relief during
The Coronavirus (COVID-19) Epidemic?

Contact the Tax Lawyers at
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for a FREE Tax HELP Contact us at:
www.TaxAid.com or www.OVDPLaw.com
or Toll Free at 888 8TAXAID (888-882-9243) 

It is time for people to wake up and realize that “Quiet” Disclosures really don't make sense in light of the Streamline Voluntary Disclosure Program, which may not be available much longer.

According to DoJ, Lake Worth Businessman Pleads Guilty to Evading Taxes on Millions in Income, Stashing Funds in Secret Accounts Around the World.

 

 

He Tapped Hidden Accounts

To Buy $1.3 Million Yacht And Waterfront Property

and Filed a False “Quiet” Disclosure

A Lake Worth, Florida, businessman pleaded guilty today to tax evasion and willful failure to file a Report of Foreign Bank or Financial Account, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Ariana Fajardo Orshan for the Southern District of Florida.

According to court documents and statements made in court, Dusko Bruer owned and operated a company that bought U.S.-made agricultural machinery and parts and sold them throughout the world. Beginning in 2003, the company did not pay Bruer a salary. Instead, Bruer used millions of dollars from the company’s bank accounts to pay his personal expenses, make investments abroad, and make transfers to an employee and his family.

From 2007 through 2011, Bruer transferred over $5.8 million of the company’s profits to foreign financial accounts. Bruer used the company’s profits to buy a yacht, purchase a waterfront home for his girlfriend and himself, purchase a home for an employee, and buy real property in Serbia. Between 2007 and 2014, Bruer failed to report more than $7.7 million in income and did not pay taxes of more than $2.7 million that were due to the United States.

Although Bruer’s company had a number of employees and reaped millions of dollars in profits, Bruer never filed a corporate tax return for the company nor did the company ever pay taxes on its income. Bruer also never filed employment tax returns during those years reporting wages that the company paid to its employees nor did the company withhold and pay over payroll taxes. From 2007 through 2015, Bruer maintained financial accounts in Croatia, Germany, Serbia, and Switzerland. He did not report his ownership of the accounts to the Financial Crime Enforcement Network (FinCEN) by filing a Report of Foreign Bank or Financial Account (FBAR), despite knowing he had an obligation to do so. In 2010, an account he held at a subsidiary of Credit Suisse AG in Zurich, Switzerland reached a year-end high value of $6,177,586. Bruer used the assets in his foreign accounts for personal use, including the purchase of a yacht for $1,350,000 and a 3,200 square foot home in Lake Worth, Florida, with 100 feet of waterfront frontage for approximately $1,650,000.

From 1999 to 2014, Bruer never filed a personal tax return nor did he pay tax on his income. In 2015, Credit Suisse closed his account in Switzerland and advised him to enter the IRS’s Offshore Voluntary Disclosure Program (OVDP), by which taxpayers could avoid criminal prosecution by making a voluntary disclosure directly to IRS-Criminal Investigation, filing six years of delinquent or amended income tax returns, as well as delinquent or amended FBARs, paying back taxes, interest, and certain penalties on the six tax years in the disclosure period, and paying a penalty on the highest aggregate account balance of their noncompliant offshore assets.

Bruer Did Not Enter Into The OVDP Because He

Determined That The Cost Would Be Too High?

(Really?#*)

Do You Value Your Freedom? 

Instead, Bruer made a “quiet” disclosure that involved filing several delinquent tax returns with the IRS, not flagging the returns in anyway or paying the taxes, penalties and interest that would be paid in OVDP.

The Returns Bruer Filed As Part of His “Quiet” Disclosure Were False Because They Disclosed Only The Funds He Held In The Credit Suisse Account and Not The Funds He Held In The Accounts In Croatia, Germany, Serbia, Nor Did They Report The Income He Earned From His Company.

United States District Court Judge Senior District Judge Kenneth A. Marra scheduled sentencing for June 12, 2020. Bruer faces:

• a maximum sentence of five (5) years in prison for each charge,
• three years (3) of supervised release,
• restitution, and
• monetary penalties.

 As you can see, the "Quiet" Disclosure really work well for this taxpayer - NOT!

 

Do You Have Undeclared  Offshore Income?

Is Your Name Being Handed Over to the IRS?

  

Want to Know if the OVDP Program is Right for You? 

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 Law360, people working in countries other than their usual ones because of the coronavirus pandemic aren't likely to trigger new taxation requirements for employers under global treaty rules, according to guidance issued Friday by the Organization for Economic Cooperation and Development.

In general, workers who are temporarily based in a different country because of cross-border travel restrictions related to the outbreak probably won't incur new tax obligations under international tax treaty rules, according to the guidance. The OECD noted that travel restrictions are among the unprecedented measures governments have taken in response to the global spread of the virus, which causes the respiratory disease COVID-19.

A company's taxable presence in a jurisdiction, its permanent establishment or PE, is determined based on the tax treaty between its home country and the jurisdiction in question. Some businesses may be concerned that employees who are stranded in countries where they don't normally work could create a permanent establishment there, but companies probably won't have to worry based on treaty rules, according to the guidance.

For employees working from home, the guidance cited the OECD's Model Tax Convention, which is meant for countries to use when they write tax treaties. The OECD Model explains that even though part of a company's business may be conducted out of an employee's home office, “that should not lead to the conclusion that that location is at the disposal of that enterprise.”

Teleworking from home because of the COVID-19 crisis wouldn't create a permanent establishment because such activity lacks a sufficient degree of permanency or because the company has no control over that home office, except through that one employee, according to the guidance.  

However, the guidance noted that thresholds for tax registration under domestic law may be lower than those under a tax treaty and may therefore trigger corporate income tax filing requirements. Accordingly, the OECD encouraged tax administrations to provide guidance on domestic law threshold requirements in the context of the COVID-19 crisis.

Some countries have already started issuing guidelines. The Australian Taxation Office recently published guidance that said it will “not apply compliance resources” to determine if a company has a permanent establishment in the country if the business has employees there only because of travel restrictions related to the pandemic.

Employees who are working in a different country from their usual also aren't likely to create a new individual tax residence under global treaty rules, according to the OECD guidance. A new tax residence could change where that person's income is taxed, but under a situation like the current pandemic, treaty residence is likely to remain in the home country, according to the guidance.

“Despite the complexity of the rules, and their application to a wide range of potentially affected individuals, it is unlikely that the COVID-19 situation will affect the treaty residence position,” according to the guidance.

Countries have started issuing guidance on the impact of the COVID-19 crisis on the tax residency statuses of individuals who have been forced to relocate. Last month, the U.K. government relaxed its tax residency rules amid the pandemic. Australia also published guidance stating that people won't be considered residents of the country for tax purposes if they're temporarily there because of COVID-19.

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

for a FREE Tax HELP Contact us at:
www.TaxAid.com or www.OVDPLaw.com
or Toll Free at 888 8TAXAID (888-882-9243)