Use of Offshore Insurance Scams & Merchant Accounts to Evade Taxes - IRS Zeroing in on.

According to senior government officials, the government is continuing to crack down on offshore tax avoidance in a variety of ways, including a new focus on the use of offshore insurance companies and offshore merchant accounts to hide assets.

       
Officials described many facets of an overall goal to stopping tax evasion, speaking to the Civil and Criminal Tax Penalties Committee May 12 at the spring meeting of the American Bar Association Section of Taxation.
        
, said in addition to multiple investigations of banks that are ongoing, the government has initiatives in earlier stages that it expects will be productive as well.         

IRS is looking at offshore insurance scams that involve “protected cell corporations,” in which a taxpayer's money goes into a cell that is separate from all the company's other investors, John McDougal, a special trial attorney in the IRS Office of Chief Counsel said.
        

In this structure, he said, “it appears that you're one of many shareholders in the company, but it's really designed to disguise the fact that you're controlling your own funds in your own protected cell. That's really subject to abuse and we're going to be looking at this.”          

In a second area, the government is looking at offshore merchant accounts used by U.S.-based businesses to divert their credit card income offshore. He said the government has already issued a John Doe summons in this area to identify a few cases it can examine and potentially get information that it could use for additional summonses.
        
As those efforts go forward, he said, IRS is using information it has gleaned from its Offshore Voluntary Disclosure Program to target banks engaging in helping taxpayers hide assets overseas.

If you have IRS Tax Problems, contact the Tax Lawyers at Marini & Associates, P.A. for a FREE Tax Consultation at www.TaxAid.us or www.TaxLaw.ms or Toll Free at 888-8TaxAid (888 882-9243).

     

IRS Announces More Flexible Offer-in-Compromise Terms to Help a Greater Number of Struggling Taxpayers Make a Fresh Start

IR-2012-53, May 21, 2012 The Internal Revenue Service today announced another expansion of its "Fresh Start" initiative by offering more flexible terms to its Offer in Compromise (OIC) program that will enable some of the most financially distressed taxpayers clear up their tax problems and in many cases more quickly than in the past. "This phase of Fresh Start will assist some taxpayers who have faced the most financial hardship in recent years," said IRS Commissioner Doug Shulman. "It is part of our multiyear effort to help taxpayers who are struggling to make ends meet." Today’s announcement focuses on the financial analysis used to determine which taxpayers qualify for an OIC. This announcement also enables some taxpayers to resolve their tax problems in as little as two years compared to four or five years in the past. In certain circumstances, the changes announced today include: Revising the calculation for the taxpayer’s future income. Allowing taxpayers to repay their student loans. Allowing taxpayers to pay state and local delinquent taxes. Expanding the Allowable Living Expense allowance category and amount. In general, an OIC is an agreement between a taxpayer and the IRS that settles the taxpayer’s tax liabilities for less than the full amount owed. An OIC is generally not accepted if the IRS believes the liability can be paid in full as a lump sum or a through payment agreement. The IRS looks at the taxpayer’s income and assets to make a determination of the taxpayer’s reasonable collection potential. OICs are subject to acceptance on legal requirements. The IRS recognizes that many taxpayers are still struggling to pay their bills so the agency has been working to put in place common-sense changes to the OIC program to more closely reflect real-world situations. When the IRS calculates a taxpayer’s reasonable collection potential, it will now look at only one year of future income for offers paid in five or fewer months, down from four years, and two years of future income for offers paid in six to 24 months, down from five years. All offers must be fully paid within 24 months of the date the offer is accepted. The Form 656-B, Offer in Compromise Booklet, and Form 656, Offer in Compromise, has been revised to reflect the changes. Other changes to the program include narrowed parameters and clarification of when a dissipated asset will be included in the calculation of reasonable collection potential. In addition, equity in income producing assets generally will not be included in the calculation of reasonable collection potential for on-going businesses. Related Items: Interim Guidance Memorandum for Offer in Compromise Internal Revenue Manual 5.8.5.5.1, Income-Producing Assets

Principal of Red Sea Management Sentenced to 20 Years.

Jonathan Curshen, 47, the principal of Red Sea Management and Global Securities and Honorary Consul to Costa Rica for St. Kitts & Nevis was sentenced to 20 years in prison for a $7 Million Stock Manipulation Fraud in Miami on Friday last week.

Curshen and his co-defendant, Las Vegas stock promoter Nathan Montgomery, were involved in a scheme to illegally manipulate the stock price of CO2 Tech.

The evidence further showed that, from approximately 2003 through 2008, Curshen operated Red Sea as a money laundering hub in Costa Rica that established bank accounts and brokerage accounts in the United States and Canada under false pretenses and through nominee owners. The evidence further showed that Curshen and his co-conspirators laundered the proceeds of the stock fraud from accounts in the United States to an account in Canada, all in an effort to conceal and disguise the nature and source of the proceeds.

Stock promoters Barham and Weidenbaum were sentenced yesterday to 30 months and 26 months in prison, respectively. Michael Krome, a securities attorney from New York, who participated in the conspiracy and evaded federal securities registration requirements, was sentenced yesterday to 34 months in prison. Reynolds is scheduled to be sentenced at a later date.

Posted on 14May 2012 by Naomi Cohen

Facebook's Co-Founder Just Defriended America

Face book's Mark Zuckerberg may get all the hype in the romping road show run-up to the company’s historic IPO.

But the latest news-grabbing Facebook co-founder is Eduardo Saverin, best known for his bitter legal battle with Mr. Zuckerberg as portrayed in the move The Social Network.

Now Mr. Saverin may become even more renowned for renouncing his U.S. citizenship ahead of the company’s IPO. In fact, it turns out he did it a good deal ahead of the IPO, and that’s likely to matter.

If you want to "Expatriate" save US taxes, contact the Tax Lawyers at Marini & Associates, P.A. for a FREE Tax Consultation at www.TaxAid.us or www.TaxLaw.ms or Toll Free 888 882 9243 (888 8 TaxAid).

Swiss Bank Whistle-Blowers Have Handed Over Data to U.K.

Bloomberg - Whistle-blowers at two Swiss banks have handed over client account data to U.K. tax authorities, according to two people with knowledge of the matter.

The Revenue Authorities are examining the data before writing to U.K. resident account holders and sharing the information with other countries.

At least one of the banks is foreign-owned and has clients spanning more than 100 jurisdictions.

If you have unreported Foreign Bank Income, contact the Tax Lawyers at Marini & Associates, P.A. for a FREE Tax Consultation at www.TaxAid.us or www.TaxLaw.ms or Toll Free 888 882 9243 (888 8 TaxAid).

 

Foreign Banks refuse to handle accounts of Americans.

That's what some of the world's largest wealth-management firms are saying ahead of Washington's implementation of the Foreign Account Tax Compliance Act, known as Fatca, which seeks to prevent tax evasion by Americans with offshore accounts.

HSBC Holdings, Deutsche Bank, Bank of Singapore and DBS Group Holdings all say they have turned away business. "I don't open US accounts, period," said Su Shan Tan, head of private banking at Singapore-based DBS, Southeast Asia's largest lender, who described regulatory attitudes toward US clients as "Draconian."

The government needs to be tougher on offshore tax crimes than it has been, said US Representative Richard Neal, a Massachusetts Democrat and one of the original sponsors of the legislation. Fatca, introduced after Zurich-based UBS said in 2009 that it aided tax evasion by Americans and agreed to pay $780 million (Dh2,868 million) to avoid prosecution, is already helping to improve banking transparency, he said.

"Most of the hedge funds I know in Asia won't take American clients," said Faber.

Bank of Singapore, the private-banking arm of Oversea-Chinese Banking, ranked strongest in the world for the last two years by Bloomberg Markets magazine, has turned away millions of dollars from Americans because it doesn't want to deal with the regulatory hassle, according to Chief Executive Officer Renato de Guzman. The bank had $32 billion under management as of the beginning of the year.

At industry meetings he attends in Singapore, not accepting US clients is "quite a prevailing sentiment," de Guzman said. There are 18 private banks operating in Singapore, including units run by UBS, Credit Suisse Group, Deutsche Bank and HSBC, he said.

For more go to: Gulfnews.com

It may be better to take a hit on FATCA?

The Association of Investment Companies (AIC) has suggested to members with modest investments in US securities that they may be better off not signing up to controversial tax initiative FATCA and taking the penalty charge.

FATCA, or the Foreign Account Tax Compliance Act, is a set of measures designed to fight offshore tax evasion by US citizens. It will be a significant cost and administrative burden for financial institutions and investment companies.

For companies which do not derive a significant proportion of their revenues from the US and have few US investors, the cost of complying outweighs the 30% withholding penalty, the AIC said.

The number of US shareholders with stakes in UK registered trusts is minimal, argues the AIC.

“If you are not invested in the US, or have minimal exposure, it might be better to take the modest hit from the 30% withholding tax as opposed to racking up much more substantial costs from all the administration in complying,” said Ian Sayers, director general at the AIC .

“For these trusts the impact would be too small, so it is not worth signing up.

“VCTs, for example, are predominately made up of UK retail money and UK investments, so they may not have to sign up and in fact will be better off not complying.”

FATCA timetable

Autumn 2012: IRS to publish final model FFI agreement.
January 2013: Entities can start signing IRS agreements.
January 2014: Start of withholding of US-source income to non-participating entities.
January 2015: Start of withholding of US-source gross proceeds to non-participating entities, also reporting of ‘passthru payments’ commences.
January 2017: Institutions required to withhold on their payments to other non-participating institutions.

For more go to IFA   

· 

· 

· 

·inShare0

·