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U.S. citizens who have not yet disclosed their offshore assets should read this …
US Reopens Offshore Disclosure Scheme. by Leroy Baker, Tax-News.com, New York
[ http://www.lowtax.net/asp/story/front/US_Reopens_Offshore_Disclosure_Scheme____53376.html ]
“The overall penalty structure for the new program is the same for 2011, except for taxpayers in the highest penalty category.
For the new program, the penalty framework requires individuals to pay a penalty of 27.5% of the highest aggregate balance in foreign bank accounts/entities or value of foreign assets during the eight full tax years prior to the disclosure. That is up from 25% in the 2011 program. Some taxpayers will be eligible for 5 or 12.5% penalties; these remain the same in the new program as in 2011.”
maravilla, unless I am mistaken, the number $10,000 or less in an offshore bank account, need not be reported to the IRS or Treasury. If $10,000 or great, you must submit TD F 90-22.1.
Is the value of the offshore asset (real estate) assessed by a sales invoice, or by what has been reported to the Costa Rican government for property taxes?
[quote=”sprite”]Is the value of the offshore asset (real estate) assessed by a sales invoice, or by what has been reported to the Costa Rican government for property taxes?[/quote]
I don’t think we ever established for sure whether real estate was included in this, or did we?
[quote=”Disabled Veteran”]maravilla, unless I am mistaken, the number $10,000 or less in an offshore bank account, need not be reported to the IRS or Treasury. If $10,000 or great, you must submit TD F 90-22.1.[/quote]
Does this mean that at any time during the year the bank
account has $10,000 or more?OR, that the total in the account OVER THE SPACE OF A YEAR
if over 10,000 or more must be reported???And if one has a few accounts, does this mean that EACH ACCOUNT in different banks must be reported if over 10,000
or more in that specific bank??OR that the total amount in ALL ACCOUNTS, if added up to 10,000 or more, must report.
i remember reading the rules on this reporting several years ago and it said if the aggregate sum is $10,000 for one second of one day, you have to report. so you could have 10,000 accounts with $1.00 in each of them, and you would have to comply.
it was the one second of one day that impressed me.
[quote=”Scott”][quote=”sprite”]Is the value of the offshore asset (real estate) assessed by a sales invoice, or by what has been reported to the Costa Rican government for property taxes?[/quote]
I don’t think we ever established for sure whether real estate was included in this, or did we?[/quote]
Hi Scott, I am not sure if you are talking about the anual report that goes to IRS with our tax returns, form number 8939, Statement of Foreign Financial Assets. I was told that, by my CPA here, all assets here needed to be included in that form. Ron USCG Ret
New IRS Reporting Requirement for all Foreign Bank & Financial Accounts.
Now you must tell the IRS that you have a Foreign Account even if the high balance was only a Penny!!!
The 2011 Schedule B for reporting Interest & Dividend Income now states:
Check the “Yes” box if at any time during 2011 you had a financial interest in or signature authority over a financial account located in a foreign country.
Check the “Yes” box even if you are not required to file Form TD F 90-22.1.
The following exception on the 2010 instructions is now gone: Exception. Check the “No” box if the following applies to you.
The combined value of the accounts was $10,000 or less during the whole year.
There is also a new question on Schedule B that allows you to check “no” if you’re not required to file Form TD F 90-22.1.
Note that the new Schedule B instructions discuss the requirement to file Form 5471 for Foreign Corporations, Form 8938 for Specified Foreign Financial Assets and Form 3520 & 3520-A for Foreign Trusts.
http://www.irs.gov/pub/irs-pdf/f1040sb.pdf
…I think were all caught up in this drag net one way or another.
If you choose to worry about this, go right ahead. I have so many more important matters to consider. Deciding which color pants to wear today, for example, is more important to me and will probably have more consequence attached.
The IRS is all about population control and wealth confiscation via harassment and fear. Sometimes it seem that the money is not even the real issue for them. Sometimes, it seems it is just the forceful imposition of timely reporting regulations upon an enslaved population to harass and teach obedience.
Sprite,
Couldn’t agree with you more on how the irs works. The tax code is crazy complex and penalties are absurd. Maybe Ron Paul can abolish it in 2013 😉
Just hoping to use this thread as a sort of info source for those interested in the old forms(5471 or 8865) or new forms (8938 ) required for foreign CR corporations (SRL, SA, Limitadas). I guess bank accounts would be included in this discussion too. It was Scott’s webmail on Form 8938 (Thanks Scott!!) that peaked my interest into this subject on what to do with my filing situation since I have property held in a CR corp structure.
For those interested, I found this cpa blogsite to be a good source of info. Just read back far enough to get a good feel for upcoming filing. Ciao…
For the last couple of years, upon buying my CR home, I have prepared and attached IRS Form 5471, to my 1040; and claimed the CR property tax deduction. I keep less than $10,000 in my CR bank acoount at any time, to prevent additional form filings with the IRS and Treasury. CR banking rules and regulations are also becoming more burdensome, for expat account holders. My CR bank recently informed me, that my CR attorney would have to recertify our corporation, myself and my wife as shareholders. It says a lot, when the bureaucratic head of the IRS, has to hire accounts to prepare his tax return.
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