For many people, 2020 was a year that can’t be forgotten soon enough. But, while 2020 was difficult and indeed tragic for many families, it is important to take the lessons we learned during the year with us into 2021.

U.S. taxpayers with financial assets overseas have an obligation to report these assets to the federal government. While there are certain thresholds, most individuals and entities with offshore financial assets will need to report them, and failing to do so can lead to substantial penalties. In order to avoid these penalties, it is strongly advised that all U.S. taxpayers with offshore assets consult with a Virginia international tax attorney.

As a U.S. taxpayer, it is up to you to make sure you meet your obligations to the Internal Revenue Service (IRS) on time. This includes not only paying what you owe but making all requisite filings as well—even if they do not come with tax liability attached. If you fall behind on your federal tax obligations, using one of the IRS' “voluntary compliance” options can help mitigate your exposure; however, you need to be extremely careful in order to avoid increasing your risk of prosecution and penalization. With this in mind, it is important to work with an experienced Virginia tax attorney to decide on your best path forward.

If you owe money to the Internal Revenue Service (IRS), you have options available for mitigating your liability and reducing your risk of criminal prosecution. However, in order to take advantage of these options, you may need to act quickly, and it will be important to make informed decisions based on the advice of an experienced Virginia IRS voluntary disclosure lawyer.

If you have fallen behind on your reporting obligations, then one option you may have is to utilize the IRS’s streamlined filing compliance procedures. There are a number of eligibility criteria, the most-important of which is that your failure to file must have been “non-willful.” If you submit a streamlined filing and the IRS determines that you willfully failed to disclose your offshore bank accounts, then it may initiate an audit and impose full penalties for your disclosure violation.