When it comes to international taxation, penalties for non-compliance are severe and can lead to criminal prosecution. Listed below are 4 IRS International Tax Forms that cannot be ignored. Taxpayers often default through failure to file tax returns for some or all foreign assets and interests. Subsequently, the government has enacted strict filing requirements.
There are several forms that would apply to different taxpayers with offshore interests, depending on their specific circumstances and status; here are the top five that you don’t want to forget to file:
4 IRS International Tax Forms
- Form TD F 90-22.1
This is the Report of Foreign Bank and Financial Accounts (FBAR) form, where the taxpayer is required to disclose all foreign accounts and related income. This includes bank, brokerage, mutual fund, trust or other financial accounts subject to the applicable threshold. It also includes accounts where you have signature authority, but no ownership.
- Form 8938
This form refers to the statement of specified foreign financial assets, which must be reported here. It applies if the total value of the assets is more than the applicable reporting threshold.
- Form 3520
This form is the Annual Return to be filed with your tax return for every qualifying foreign trust transaction or foreign gift received. The form’s instructions highlight qualifying transactions and exceptions.
- IRS Offshore Voluntary Disclosure Initiative (OVDI) (OVDP) Forms
In this circumstance, where individuals opt to disclose their unreported foreign interests, there are in fact several forms. This includes the TD F 90-22. 1; Form 433A; Form 433B; Form 872; Power of Attorney Form and Consent to Extend FBAR Statute. Fortunately, your legal and tax specialist will be able to walk you through these requirements in greater detail.
When it comes to compliance, filing the right international tax forms correctly is non-negotiable. The services of a reputable and experienced tax attorney and international CPA are required, be it these 5 IRS International Tax Forms or others. Mistakes or omissions will not be condoned by the IRS and can lead to prosecution.
Chris Byrnes Lawyers is an International Tax Advisory firm specializing in issues of compliance, tax, amnesty and international tax law. Contact our tax lawyers today.