August 4, 2009 - Phil Hodgen

FBAR amnesty audit and bleed-over effect

One of the recurring questions I get is whether going through the amnesty process will cause the IRS to declare open season on all of the prior year tax returns.  Will you be audited for all of your completely unrelated income and deductions if you come forward and declare your previously-hidden offshore bank account?

No guarantees on this.  ‘Kay?

The story is (David got this from his session last Friday in San Francisco) that in theory this is possible.  But look at the reality.  (1) These are old years.  (2) The agent doing your amnesty examination for international matters will have a s***-ton of other amnesty files just like yours.  (3) The agent doing your amnesty examination is also the same one who has to follow through and ask you about your charitable deductions, mileage expense claims, etc.  (4) The agent doing your amnesty examination is probably specifically and highly trained in international tax matters.

You get my drift?

If a full-tilt audit occurs, you’ll deal with it.  Don’t listen to your brain. (Caution:  Mark Twain).

Call me if you want help cleaning up your messes.  Mobile:  +1-626-437-2500.

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