International Tax Issues and FBAR Reporting
565 West Adams Street, Suite 600, Chicago, IL 60661
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The Tax Practice of IIT Chicago-Kent College of Law
The Tax Practice of IIT Chicago-Kent College of Law


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Chicago Tax Lawyers Assistance with International Tax Issues and Foreign Bank Account Reporting (FBAR)

chicago foreign tax penalty lawyer

International Tax Consulting

The Tax Practice of IIT Chicago-Kent College of Law has extensive experience with the range of legal issues facing recent immigrants, and those wanting to do business in the United States. We provide assistance with foreign direct investment, local entity formation and compliance, and foreign tax credit issues. As a full-service commercial transactions practice, we can handle most all your business organization and compliance needs, including drafting operating agreements, By-Laws, and employment/non-compete contracts. We regularly consult with and work as local counsel on behalf of foreign attorneys representing international individual and corporate interests.

Are You a U.S. Citizen or Resident Alien with a Foreign (non-U.S.) Bank or Other Financial Account?

If so, you may be responsible for filing forms with the U.S. Government disclosing the existence and value of those foreign accounts. And the sanctions for noncompliance are quite severe – much more so than with routine income tax noncompliance: A civil penalty up to $10,000 may be imposed by the IRS upon a U.S. citizen or resident alien per incidence of non-compliance with the Foreign Bank Account (FBAR) filing requirements. Where the IRS determines "willfulness" for the FBAR non-compliance, it may increase the civil monetary penalty to the greater of $100,000 or 50 percent of the balance in each account at the time of the violation. Finally, the IRS could pursue criminal sanctions for egregious noncompliance.

Is There Relief Available?

Even if you have years of noncompliance, "reasonable cause" may save you from some or all of the penalties. The government has also instituted a reduced penalty program known as the "Streamlined Domestic Offshore Procedures", available to taxpayers who have not been willful with their noncompliance, and have not been contacted by the IRS regarding this matter, among other eligibility criteria. If they qualify, taxpayers pay a flat 5% of the highest aggregate value of the accounts during the "covered period", generally the past six years. In addition, taxpayers must have reported all income earned on those accounts and paid any delinquent taxes (filing amended 1040 returns, if necessary) for the past three years.

At the Tax Practice of the IIT Chicago-Kent College of Law, we have many years of experience assisting taxpayers with foreign bank account reporting compliance, including preparing amended returns for clients and qualifying them for the Streamlined Domestic Offshore Penalty program, as warranted. We are an authorized electronic filer, and have brought peace to many clients facing the uncertainty and potentially harsh consequences of noncompliance. If you have concerns regarding your foreign bank account reporting requirements, or need some information on compliance, why not contact one of our experienced attorneys?

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