Event 14 Oct. 2022
Curtis Provides Capacity Training to the Government of Uganda
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Event 21 Sep. 2022
Kalidou Gadio Speaks at AIEN 2022 International Energy Summit
News 15 May. 2023
Curtis represents e-commerce retailer in its fight to recover monies withheld by PayPal, the global payment giant
News 16 Dec. 2022
Curtis Trade Team is top ranked in Chambers Asia-Pacific 2023
Event 08 May. 2023
Partner Irene Petrelli to Participate in ICC YAAF Event
News 02 May. 2023
Curtis Italy with DeA Capital in the Acquisition of Magic S.r.l
Event 23 May. 2023
Partners Luciana Ricart and Fernando Tupa Will Teach a Workshop on Hearings in Investment Arbitration for Arbanza School of Arbitration’s Online Program
Publications 23 Feb. 2023
Fernando Tupa Publishes Book on Forum-Specific Consent to International Arbitration in Investment Agreements
Event 03 May. 2023
Dr. Borzu Sabahi to Speak at ICSID-ADGM Joint Conference: Investment Protection and Armed Conflict
Event 19 Mar. 2023
Sebastiano Nessi speaks at Bahrain Business and Legal Landscape Conference
Event 01 Jun. 2023
Curtis Environmental Chair Charles Howland to Moderate Panel Discussion on Latest Developments in Environmental Due Diligence at ABA Masterclass on Environmental Transactions
News 25 May. 2023
Curtis Files SCOTUS Amicus Brief for Distinguished Law Professors in First Amendment Retaliatory Arrest Case
News 06 Mar. 2023
Russia Sanctions at the First Anniversary: An Overview of Current Sanctions in the US, UK, and EU and How Global Companies Can Navigate Evolving and Conflicting Sanctions Regimes
Client Alert 30 Aug. 2022
The EU Adopts the “Maintenance and Alignment” Sanctions Package
Client Alert 24 Jun. 2021
Update on Virtual Notarization (Executive Order 202.7) During the COVID-19 (Coronavirus) Pandemic (Updated: June 24, 2021) — U.S. Insight
Update on Virtual Witnessing (New York Executive Order 202.14) During The COVID-19 (Coronavirus) Pandemic (Updated: June 24, 2021) — U.S. Insight
Publications May 2009
In our April 2009 Client Alert, we described an Internal Revenue Service ('IRS') initiative to encourage taxpayers who hold assets in foreign financial accounts to disclose the holdings through the IRS voluntary disclosure process ('Initiative'). On May 6, 2009, the IRS published frequently asked questions and answers ('FAQ') that clarify issues raised by the Initiative.
One issue of particular interest to many taxpayers is the effect of the Initiative on a taxpayer who failed to file Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts ('FBAR'). Generally, a taxpayer is required to disclose foreign accounts by filing the FBAR. Failure to file an FBAR may subject a taxpayer to an annual penalty of up to 50% of the account balance for each FBAR that is not filed. Under the Initiative, the 50% annual FBAR penalty is replaced with a single penalty of 20% of the account balance. However, in many situations, taxpayers actually have reported and paid taxes on the income derived from foreign accounts but, being unaware of the FBAR requirement, never filed the FBAR. A taxpayer in such situation should not use the voluntary disclosure process, according to the FAQ. Instead, the taxpayer should, by September 23, 2009, file the delinquent FBARs along with copies of their tax returns for all relevant years and a statement explaining why the FBARs were filed late. The IRS will not impose a penalty on such taxpayer for the failure to file the FBARs.
In other situations, some taxpayers with undisclosed foreign accounts have belatedly filed amended returns to report and paid tax on the income generated by such accounts, without otherwise notifying the IRS. The FAQ encourages taxpayers who made such 'quiet disclosures' to come forward under the voluntary disclosure process by September 23, 2009 to take advantage of the penalty framework under the Initiative. Taxpayers who wish to use the voluntary disclosure process should send a letter to the appropriate IRS agent stating the desire to make voluntary disclosure and providing other required information. A taxpayer is expected to file correct delinquent or amended tax returns for tax year 2008 back to 2003.
The FAQ also provides clarification on other issues in connection with the Initiative and the voluntary disclosure process. Taxpayers who seek to take advantage of the Initiative should consult tax advisors in regard to its requirements and implications.
To ensure compliance with requirements imposed by the IRS, we inform you that, unless explicitly provided otherwise, any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.
Marco A. Blanco
Partner
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