Just Me offers advice to newbies to the subject of FBAR compliance and OVDP considerations. To join or not to join. That is the question. This is a must read post.
A link to his Case Study of Communication with the IRS through the entire 851 day process is here.
The purpose of this post is to address Minnows who may be new to Isaac Brock. By Minnows, I mean those of you who were not the original target of the IRS offshore account jihad that started in 2009. Those I call Whales. They were the UBS type tax evading “US persons” living in the Homeland and squirreling away their money in “offshore” secret Swiss Bank accounts specifically to hide it from the IRS. If this is not you, then you can read on. If you are a Whale, or if you have already been around the block on all these IRS VD issues and feel well-informed, you can probably skip reading this post.
If you are a Minnow visiting the Isaac Brock Society you are probably concerned about recent IRS programs and what it all means for you as an US Expat, accidental US Citizen abroad, or an immigrant to America. Some of you are now faced with a hard decision as to what your response will be. You want to know whether or not to join the most recent iteration of the Offshore Voluntary Disclosure Program (OVDP) which may be driven by fear as result of a disingenuous marketing effort created by IRS press releases and totally mischaracterized by a compliant and non skeptical US media. This is a very tough decision that many of you are struggling to make. Far be it from me to give you advice on what you should do. You will not find that answer in this post. However, I can point you in the direction that might help you with the decision that only you can make.
Since I am always reticent to provide specific advice on a blog as to what one should or should not do, I want to be sure you understand that information here does not imply that I am encouraging anyone to do anything other than self educate!
I recognize there are others who will advocate strongly for not joining, or will provide more detailed advice then I am willing to do. I would always caution new readers to be wary of specific advice provided in a causal or generalized way in any online forum. Blogs are a great source of information for continuing education, but when it comes to the OVDI issues, they don’t substitute for good legal advice based upon your very specific facts. But…., before you throw good money at a tax practitioner, you need to go down the self-education route. You need to do some drudgery!
Let’s start now. This may be in the category of conventional wisdom, but it is worth repeating.
I have to assume by now, you have read the About Isaac Brock Society, and know this is a great information sharing site with lots of knowledgeable and good bloggers, but I want to direct your attention to some of the excellent information that is also provided on another blog by a tax attorney professional named Jack Townsend. His blog is called Federal Tax Crimes.
There are many other blogs around the internet, but I am going to suggest that you just focus on these two sites right now. Links here at Isaac Brock will expand your learning universe, but at the start of an educational journey you might try maintaining a site specific core focus to begin with, and Jack’s blog might be a good beginning. Then come back here for additional learning and updates. If you start wandering all over the internet and googling everything, you are just going to get lost and confused. There are many attorneys or bloggers telling you what a great thing it is to declare your sins at the OVDI altar and “come clean.” Run away from anyone that tells you that without knowing anything about you or your specific facts.
Jack’s blog was designed for attorneys and students and not lay people. However, with the advent of the first OVDP of 2009, it has become an excellent source for learning for the rest of us non experts. Jack has indulged many lay readers with his time, answers, and advice. He has provided an excellent forum for information exchange amongst novices on specific OVDI procedures. That is why I am placing a high value on it, and why Isaac Brock lists it as an external resource at the bottom of this page.
Between Isaac Brock and Jack’s blog, you should garner enough good information to make an intelligent decision that is right for you. Once you get through all the reading that I will suggest you do, and you update yourself with the new information that is flowing into here daily, you should be well armed with the prerequisite knowledge necessary to approach an attorney for strategic advice and help, if required. That is why I am proposing that do your own due diligence drudgery first, before you run to some unknown practitioner or blog for help in deciding what to do.
Now, I know this is probably the last thing you really want to do. “Why should you have to do it?” you might say. It is absolutely ridiculous that the US government is treating you this way, and you are angry and a bit fearful. You are not alone. We have all felt that way and expressed it.
You maybe overwhelmed and beleaguered by it all. “Now, you want me to do some additional drudgery too?” you might ask. Just accept that as a fact, and do it anyway! I know, I know! Who in their right mind wants to read legalese, endless blog posts, IRS manuals (IRM) and pour over every nuance of the FAQS the IRS issues about the OVDI? None of us do, I think. But you are reading this, so you must know in your heart that you have to.
The tax practitioners know that many of us are either too lazy or not so inclined to dig into these unfathomable subjects. Some of them have spent a lot of time studying the issues and laws, (or not!) and that is why they charge so much to “take care of it” for you.
Information = power = $.
However, if these experts are not up to speed on OVDI issues, and heaven knows a lot of them are not, the last thing you want to do is pay for their education!! If you are overseas it is especially hard to consult with a good knowledgeable one, but it can be done via phone conferences back to the States on Skype. Therefore, because of the communication ease these days, I would almost never rely on an attorney in your resident country (with some notable exceptions in Canada) for advice on how to navigate the OVDI Minnow processing plant!
At this stage of your education, just take a deep breath, and devote some meaningful time on your personal drudgery. Remember, you are doing this, as much as anything, so you don’t make a wrong choice in the professional practitioner market place, should you decide to go down that route.
It is a “Buyer Beware World” out there. Some attorneys are very good, and know the ins and outs of the IRS VD programs. Some are just looking for your money. There is a lot of good commentary at the Isaac Brock Society to those points, but I want to caution you again. You have to learn to identify them. Self-education is required for you do that.
As fun as attorney bashing can be, don’t discount all of them either. A good attorney who can provide you a sounding board with critical advice at key decision points is worth every penny of the price they may charge. At least that has been my experience.
Should you decide to enter the OVDI program, and again I am not suggesting that you should, there are a lot more strategies now on how to minimize the cost in dollars then there were back in 2009.
The “Opt Out” for all its faults is beginning to look like a good option for Minnows if you are already in the OVDI process. There may be strategies on joining the OVDI and immediately asking to “Opt Out”, or just doing a straight up VD, or a Quiet Disclosure (QD), or just start filing the FBARs and 1040s from now on going forward. There are other approaches too. Some are put forth here at IBS and in other blogs that say you shouldn’t join in the first place. I am not going to advocate one way or the other about that here. Each has its own set of risks and rewards depending on facts and ones need to sleep at night.
Unfortunately, what ever your decision is across the wide spectrum of choices from doing nothing to renouncing your US Citizenship, there will still be a big cost in LCUs. (Life Credit Units). It will consume a lot of your time figuring it all out. You shouldn’t have to this, and we can bemoan it all we want, but there it is. It is what it is! You are going to have to spend something, your money or your time, and it is up to you to work out what you can afford and in what portions.
At this point, I would just say, accept that fact that this drudgery for dummies is something you have to do for yourself. At first, for some of you, it will just be incomprehensible and totally illogical. Don’t get bogged down with whether or not any of this makes logical sense. My wife had a hard time dealing with that, and kept getting distracted on the logic tangent!
For a cynic like me, tax statutes by definition are often illogical, as they are written by lobbyist, passed by politicians for heaven’s sake, defined by technical IRS writers and then interpreted by tax attorneys! And then there is you at the end of the unintended consequence train wreck chain reaction to complexity . You have to deal with the impossible compliance mess that results.
Tax laws can be stupid, arbitrary and capricious, and all that complexity gets magnified every step of way until they are applied to you. We can rant endless about it, but what’s the point other than make you feel better? It doesn’t change anything. So, just get back to the recognition that you have to bear up under the burden of lots of reading and research now to work out what to do. However, if you do it slowly, but surely, the information will seep in and stick in your brain. At least that is how it works for me! You eat this elephant one bite at a time, and surprisingly, you find out that you can digest it!
It is not easy however, and not without heart burn. It took me forever to get my little brain around the legal technicalities of willful, non willful and willful blindness issues and what penalties could apply. Understanding who had the burden of proof, what were the appeal processes inside and outside the 2009 OVDP, what litigation ‘might’ happen or not, took effort and constant re-reading and repetition. These are not natural subjects for me. Then, coming to terms with an honest assessment of where I sat on that spectrum of failure and risk took time.
Trust me on this. If you do the drudgery now, and are disciplined in the incremental learning process, eventually the way forward will become clearer and appear. The right decision for you will emerge.
If you are not already in the OVDI, the “recycled” new one without deadlines for participation, means you have time for that knowledge evolution to occur. That is an advantage you have, that a lot of folks back in the days of VDPs with deadlines didn’t have. Fear, urgency and incorrect practitioner advice drove many to make mistakes in their decision-making process. You now have time to get it right! I don’t think you need to feel rushed into a decision. You also have the advantage of reading about the experience of those who have gone before you on the processing conveyor belt. There is much to be gained from their stories.
As a good example, if you haven’t read Moby’s experience yet, this would be one that you can go to school on. (3/11/2012 Note update at end of this text)
So, if it were me, coming new to this subject, I would start reading the specific blogs which I have listed below. I would systematically work through the ones I provide in a progressive manner, starting with the oldest post first. There will be duplication of information between blog threads, but like any learning experience you need repetition for concepts to stick with you. Some of us need it more than others. And yes, again, it is a drudgery, except for a very few of you sick ones out there that love this stuff! I joke! 🙂 Who could love this? Ah yes, they have the titles like attorney and CPA attached to their names! Mate, they are not like us, but with a little effort, you can become more like them. In these matters you have to, or so it seems to me.
On Jack’s blog I would start reading in May of 2011. I don’t think you need to go back farther than that, although you certainly can using the monthly archives. The selected list below is not exhaustive, or even authoritative, but it represents progressive learning which has occurred as the OVDI was developing, and the controversies surrounding the OVDP were being discussed. I would read every comment and every additional reference provided. If Jack or someone provides a link, I would follow it to see what it says.
The special and unique thing about Jack’s blog is that sometimes he provides excellent and detailed advice around a certain set of specific facts based upon his extensive legal background and knowledge. That is very helpful. He is the professor and is qualified to do so, while I am not! I have found him to be a very valuable resource. Also, he reviews with the readers the decision tree he uses to help some of his own clients decide on their best course of action. I put great weight on what he has to say.
You will also hear many folks asking very similar questions that you may have. You will read about others sharing their experiences and giving novice responses which too can be very helpful. Of course there are plenty of opinions, as we all have one, so take that on board with a grain of salt. Since his site is moderated, if someone gets off on a wild tangent or something, it may not be put up. You don’t have to slug through a bunch of over-the-top rants although, I have had some that have been borderline! LOL
When you get done with all this reading, plus the information you are picking up here at Isaac Brock, you are now armed and ready to talk to an attorney, should you decide you want to (or not). With a strong knowledge background, you can cut to the chase, and not waste a lot of money on an attorney telling you things you already know! They then become a partner in your strategic and tactical decisions, rather than an expert dictator of what you should do!
If you are not willing to do this drudgery than be prepared to pay out BIG $. If you have more money than time, you may be tempted to do that, however you can still incur significant and unnecessary risks in spite of the money spent. By definition those reading here are probably Minnows, and likely not anxious to spend the bucks. You may be a DIY person. I was. You can go through the entire process without giving power of attorney (POA) to anyone. You can learn to trust your own council, if you do what I suggest. Just remember, if you put your OVDI life in a tax practitioner’s hands, how do you judge the quality of the advice you are given? Think about that! If you don’t have a strong knowledge foundation to measure advice against, you are setting yourself up to be fish fertilizer. So, do the drudgery now and become Fool Proof and Process Proof later!
That is the best advice I can give you for now. Hope it helps.
Happy reading!
1. Looking for Mr Fbar (added 3/11/2012)
2. Evolution of the FBAR, Where we were, where we are and why it matters, 2006 by Hale Sheppard (added 3/11/2012)
3. To OVDI or Not to OVDI – That is the Question (Of Quiet Disclosures and Doing Nothing) (5/23/11)
4. Opting Out of the IRS 2009 OVDP and 2011 OVDI (6/14/11)
5. To OVDI or not to OVDI – Part 2 (7/31/11)
6. Of Fear and Hostages: A Mid-Sight Editorial on The OVDI Program and Extortion (8/1/11)
8. Opting Out Considerations by Jeff Neiman (9/10/11)
9. Experiences Inside OVDP / OVDI (9/14/11)
10. IRS Promotes the Success of OVDI and Related Items (9/16/11)
11. Article on OVDI and Beyond – Highly Recommended (10/24/11)
12. Excellent Article on Offshore Accounts – History and Future (11/9/11)
13. IRS will Give Canadians Some Breaks!!! (12/2/11)
15. “Opting Out” of OVDI and OVDP; What is Really Happening? (12/12/11)
16. Tax Notes Discusses Dispute Between the Taxpayer Advocate and the IRS About OVDP 2011 (1/6/12)
17. IRS Re-Opens Offshore Voluntary Disclosure Program (1/9/12)
19. “Opting Out” #2 (3/2/12) (added 3/11/2012)
20. Moby “Opt Out” update (added 3/11/2012)
21. “Experiences Inside OVDP / OVDI #2 (4/4/12) (added 4/5/2012)
22. “Opting Out” #3 (4/4/12) (added 4/5/2012)
23. Open Forum Comments to Congress and IRS Regarding Tax Administration for Offshore Accounts (4/9/12)
24. IRS OVDI June 1st, 2011 Opt Out Guidelines (added 4/12/2012)
25. Article by Scott Michel, a DC attorney on foreign reporting requirements and initiatives. (added 5/8/2012)
Special note on this article, where Scott, good as he is, might have gotten something wrong. This note has been confirmed by Jack Townsend.
Scott says..
Opting out enables the IRS to conduct a full audit, and if the taxpayer can satisfy to the IRS that their conduct was not willful, lesser penalties might be imposed (for example, the non-willful FBAR penalty).
Note: It is not up to the taxpayer to satisfy the IRS, it is up to the IRS to establish willfulness. Anything the taxpayer can present in defense of non-wilfulness is useful, but ultimately, the IRS has to prove willfulness.That requires a high standard!
I think that Scott, like the IRS, slips into assuming “willfulness” if you are in the OVDI. It was what the program was designed for, willful tax evading homeland Whales. However, as we now know, given how it has been administered, and given IRS hyperbolic threats, a lot of benignly non willful minnows were in the program and should be Opting Out now rather than paying disproportional penalties.
26. IRS Warning Letters May be Sufficient for Some NonWillful Violations (5/18/12) (added 5/18/2012)
27. Burden on Government to Prove Willfulness in FBAR Matters. (Added 6/08/2012)
– Link to Jack’s discussion and comments
28. The 2012 IRS Offshore Voluntary Disclosure Initiative by Charles Rettig (Added 6/08/2012)
– Link to Jack’s discussion and comments
29. Making Voluntary Disclosures to the IRS, by Jack Townsend (Added 6/10/2012) Abstract: This paper discusses the IRS Voluntary Disclosure Practice, including tips for the practitioner. Topics include noisy disclosures and quiet disclosures as well, in some cases, just making no disclosure at all. The article places particular emphasis on the recent offshore financial account voluntary disclosure program and its alternatives.
30. National Taxpayer Advocate Report to Congress (6/27/12)
32. Tax Advocate Report Identifies IRS’ OVDP / OVDI As Problem (1/9/13) Good stats and discussion of the Opt Out process, and complexities of Offshore tax filings.
33. Report on Webinar on Opting Out and Litigating FBAR Penalties (added 1/17/13 ) This is a Must Read for those currently stuck in the OVDP and considering Opting Out.
34. Warnings on Continued Government Patience for Offshore Account Ostriches (1/31/13)
35. Report of Government Comments on FBAR Penalties at ABA Tax Section Meeting (2/1/13)
36. Article on Taxing Administration for Offshore Accounts (2/2/13)
37. IRS has New Forms for Offshore Voluntary Disclosure Letter and Attachment (3/23/13) (added 3/35/2013)
38. Hale Sheppard Article on Willful FBAR Penalty Cases (4/26/13)
39. More on the GAO Report on IRS Offshore Disclosure Initiatives (4/27/13)
41. Guest Blog: Analysis of the Data in the GAO Report (5/13/13)
42. New York State Bar Letter to Treasury to Restore OVDP Integrity by Not Ejecting Precleared Taxpayers (5/21/13)
43. IRS Modifies Policy for First-Time Penalty Relief (5/31/13)
44. Offshore Items from Report on NYU Tax Controversy Forum (6/11/’13)
45. Rubinstein on the State of Offshore Bank Account Compliance (6/12/13) (note comment by Jack where he infers that U.S. will have some type of triage that will ignore the minnows)
46. Quiet Disclosures That Don’t Stay Quiet – Civil Examinations (6/13/13)
47. An OVDI Odyssey – an Opt Out Success Story (6/16/13)
Finally: Below is the link to my personal story that is told through the letters of communication I had with the IRS through out the entire OVDP process. It starts with my letters to Commissioner Shulman, and ends with the Tax Advocacy Appeal letter that allowed me to have FAQ 35 (consider this an inside the OVDP opt out) relief. That lowered my penalty from $172K to $25k for a ‘nonwillful’ failure. Still a lot of money, and in retrospect way too much for my failure. However, the process does exhaust you, and like a plea bargain, even when you are innocent, it did allow me to put an end to a 2+year process without any willfulness charge or more lengthy appeal process or expense. Without TAS intersession, (the one bright spot in my story) I am uncertain what would have happened. Maybe I would have had even a better outcome like Moby did with his ‘Opt Out’ which came later, or maybe I would have been fish fertilizer, but will never know.
48. My Story: Letters to Shulman, or a Case Study of OVDP communication attempts with the IRS. An insider’s view of the process. (added 3/11/2012)
One final comment, which I would be remiss not to mention. Phil Hodgen’s has up until recently maintained a fine blog on OVDP and OVDI issues. I used it extensively during by own personal drudgery. I checked it daily. You will notice that Isaac Brock has it listed in the resources, and Petros comment in the thread about Phil is right on point. I like Phil’s style of writing, his cynical wit, and his advocacy on behalf of Minnows. I did do some posting there, but since the majority of my experience sharing was on Jack Townsend’s blog, I decided to keep your focus there in your discovery process.
If you read all the threads and comments that I suggest, you will note that there are often links back to Phil, and you should definitely read what he has to say. There are other blogs by attorneys that I could mention also. I have found many to be reputable and very helpful in understanding the history of how this FBAR mess all came to be. Not wanting to clutter a long post any further, I left them out. Again, if you just methodically work through the Townsend threads I have highlighted you will discover them too. It all depends on your personal tolerance level for drudgery. Not many find this discovery process an exhilarating one! 🙂
ij said: I was told today by my agent who previously told me “they had internally discussed and decided not to impose penalty on RRSP”, but now they would.
The timing of your agent’s statement is very interesting. Before they said RRSP’s were exempt but now that our Finance Minister has effectively told them to get stuffed they decide they will punish Canadians. Don’t worry they’ll be changing their minds back to being exempt again when they realize they need Canada more than Canada needs them.
Hurting little guys like you is not worth it for them, they’re just doing it out of spite against Canada. Well Canada won’t be helping them catch the real tax evaders if they keep this up.
@ij, hurting the little guys is very bad publicity. The rhetoric is that they out to get the big tax cheats. But you are small fry. The rhetoric and the reality are two different things. Chris Martenson also wrote about that; here is the money quote:
I am utterly gobsmacked for IJ. I’m outraged for him. :'(
ij.
Actually, after what I heard of Moby’s case, the Opt Out might actually work better for you, and you might come to a quicker resolution. There are being terribly inflexible inside the OVDI, but outside, I do think you will do better.
I would review the Opt Out procedures carefully, and start writing your letter. By now you should be good at it. Maybe Moby can give you some tips… That letter could be your ticket to relief from this stupidity…
http://taxlawroundup.com/files/2011/06/Procedures-for-Opt-Out-and-Removal-of-Taxpayers-from-IRS-FBAR-Voluntary-Disclosure-Program-June-1-2011.pdf
@ij,
I am so sorry to hear this from you my friend. I think you should really consider the opt out and force them to prove willfulness or stand down. You are smart enough to do this yourself with maybe just a little advice from friends up front. I am still wondering how Mr. Shulman can ignore the law in regards to a response on TAD 2011-1. I have a feeling the system is going to get log jambed with opt outs.
@Anon123,
Many thanks, and I will try to request for 5% penalty on RRSP part — which OVDI FAQ rules should apply for my RRSP (1) the taxpayer did not open the account (I did open but was then not a US taxpayer) (2) I have never withdrawn anything from the account. (3) all using US address (no blocking mail), (4) recorded by Canadian Revenue Agency as Canadian income while 100% as a Canadian taxpayer
IRS should take back their FAQ as it says. If that works, I may just go along, and get it over with.
Opt-out is in my consideration.
Again, many thanks my dear friend, and stay healthy
@anon123 and @ij…
Just called the TAS, and so want to report what I heard.
They have not received anything yet on the TAD, and they too are wondering what the response will be. Maybe the Commissioner will ask for a extension, as he is already past due.
I asked the advocacy officer if they are still handling requests for minnows in the OVDP/OVDI, or are they just recommending that they Opt Out? She said, they are still busy with handling them, and she currently had 4. They have gone so far as issuing TALs (which apparently is their highest level of direction to the IRS. Not sure what the L stands for. ).
Also, I conveyed the appreciation of many of us Minnows for what the TAS is doing generally, and Nina Olson is doing in particular to be sure they knew that we were out here watching and waiting to see the results of their efforts. I said Nina was exactly right in what she has said and done, and is a hero to me.
So, ij, I think I would be calling the TAS DC office before you just roll over and pay the 906. The RRSP might be an issue they would want to assist you with.
Don’t give up the faith yet!
BTW, just a personal note. As of Friday, I should be getting a reconciliation refund check issued for around $3000, which includes interest for over payment, and I am FINALLY FINALLY done! That has taken 3 follow up calls to Examination Department to finally see a conclusion.
So start to finish, the OVDP took 851 days of LCUs. Isn’t that just the perfect model of efficiency? Is this a GREAT country or what? LOL
Just me,
Many thanks !!!! You are a bright light (the brightest) in my darkness days.
Here is my approach.
Wait to see what is in 906
. If it is so bad (RRSP + non-RRSP) on 25%, then I will ask them to reconsider FAQ52.1 that RRSP should be on 5%. If they reject, then I will contact TAS. I lived in Maryland, so DC is not too far -:)
Thanks again for your kind help..
@IJ, I’d go to TAS anyway if I were you. What have you got to lose? Nothing ventured, nothing gained is my motto 😉
@monalisa1776,
Thanks, I do need something to show TAS if I go there, right now I do not have anything as my case is still under examination. As soon as I have their ruling (such as penalty on RRSP), then I can take this letter to TAS for help.
Thanks again for your encouragement
@IJ, I am optimistic that if you appeal that you should actually be able to have all the penalties waivered. I wouldn’t roll over to made into fertiliser, LOL.
I noted that you live in the Maryland DC suburbs; I spent my childhood in Bethesda and Rockville, plus I also have a sister-in-law who was born in Taiwan but grew up in Potomac and is doing very well in the Navy 🙂 She’s an ‘all American girl’ 😉
@monalisa1776,
Thanks… Yes, I live in Silver Spring area. It is very close to Bethesda and Rockville. I have been living in Shanghai, Halifax, Honolulu, and Maryland. I have to say — Halifax is the best.. I left the city not for “gold rush”, it was a heart-broken story when I lost my child custody and my ex took the kid away. The city became so sentimental after losing big part of my life. So I became a drifter — and ending up here in Maryland. Now, I do have three little Americans to take care. Yes, I will fight for these little Americans — this is my view for being patriotic
I know, the intent of the FBAR legislation passed in 2004 is to catch terrorists. How many of them are US citizens? How a suicide bomber should report FBAR (e.g. before or after), if he commits the terrorist act before June 30th?
Another idea for revenue collection for IRS and to help US automobile industry (who sells cars for driving on right side): the US citizens must drive right side of the road on any two way road and each violation of a US citizen will be fined by US$10,000 or 50% of the cost of the automobile.
By intent, pure and simple, is a mechanism for creating penalties that they can apply as they see fit.
It is totally useless as a law for terrorist or money laundering enforcement tool, other than it creates a law that people will fail to comply with, non willfully or willfully, and then they can penalize you. It is intended to create criminals out of normal people, and the terrorist or money launders what they hell do they care? They aren’t going to comply anyway.
Under the current OVDI, this is about revenue creation and not an enforcement tool. They, with their Statute create the crime, and then apply the penalties as they wish. Pocket the money, and claim success. A shake down, nothing more.
America has become a cannibal nation feeding their unsatiable appetite for funding from the flesh of those that they can in any way claim as their own. I can not believe that congress stands by as this shakedown process continues. They along with the IRS are blind to the damage they are inflicting. What goes around comes around and their will be future repercussions from this insanity.
Here is a really good one. Sally, a poster over at Jack’s blog just posted that after a successful opt out she thought she was done with the shakedown. Then she recently got a satsfaction survey from IRS about the process. Can you fathom the disconnect that the IRS has with the normal folks caught up in this mess? They want to measure satisfaction with what may be a two year process of utter stress, anxiety and frustration and potential financial ruin? How out of touch can you be? Please get a clue IRS. Your programs are a disgrace to the face of America.
Gosh, that is too funny in a sick sort of way. It must be part of their new PR marketing out reach. Customer Satisfaction surveys! I think I can save them the effort, and just send them the link to this!
Well, I read this rather differently.
They did not ask Anon123, and did not ask anyone who had paid huge “in lieu of penalty” but Sally who came out opt-out and paid no penalty — they thought she should be grateful — why not ? after all most in OVDP/I paid huge.
Someone came out from Auschwitz alive should be grateful being alive.
It was same kind analogy of “Just Me” cat surgery — wow what a good deal !
Post 906, Instead of a survey I got a questionnaire that was comprised of 10 questions seeking incriminating information on the bank where my funds were held. What was so stupid is that all those questions and more were conveyed to the CID at the front end of the process. I was in the program before they had come up with the standard letter submission amongst one of the numerous changes, additions and bait and switch tactics. What is even funnier, they say they can change the 2012 shakedown anytime they want. Whats new about that? You have to wonder if the submissions have slowed down to a trickle. Did anyone see the Monty Python post by Phil Hodgen a while back where the folks that showed themselves by standing up got blown up? Those images are clear in my mind.
@Anon123,
In 2011 OVDI, the standard letter to CID was submitted for pre-approval. It was basically all about who had helped to have the fund offshore, and if there were entities — names of those etc..
I found it was totally irreverent to my case — now I think that might be the base for opt-out for zero penalty.
I had heard about that post 906 letter, and seen the questions. My first thought, was if I ever got one, it would be simple. No to everything. Maybe I have dropped off their radar, as no letter has been forth coming yet.
My siblings did not get it either. Part of the same case. Go figure. Must be my luck of the draw. I think I had 1 yes answer pertaing to wiring the funds to the U.S. after the disclosure was done. One of the most comical events was when they refunded my in lieu of misc penalty by mistake and even paid interest to me on it. At first I thought they changed their minds and no longer accepted my disclosure. In reality, they had no clue why that happened but they sure took that mid six figure check back when I sent it back to them through my attorney. I have a photo copy of the check as part of my glorious file of this event. The file is a foot thick. At least I am done. I can not believe that there has been zero response to Nina Olson. How do you just brush such a serious memo under the rug and expect to have credibility and trust with taxpayers?
I too had a check returned by the IRS with interest when I tried to send in an estimate for taxes due from 2003. I sent $7500, and in actually I only owed about $750, but at the time I had no idea, and I just wanted to stop the interest and penalty accruals They sent it back to me, and I had to return it. I have a copy of that also.
In the end, according to my/examiner reconciliation documents, they owed me money, but frankly when my two refund checks finally arrived (I don’t know why two) 6 months later they did not match any of the individual yearly reconciliations they did. Made absolutely no auditing sense at all. Not one number matched anything. I gave up trying to sort it out, as frankly at this point I was sick of it. I think they may have slightly over refunded me, but who knows. Impossible to tell. You just shake your head in wonder.
As for Nina, I hate to say this, but sometimes I am wondering if there is a male ego thing here, where they discount or marginalize good sharp women. That sounds sexist, I know, but I think about how Brooksley Born of CTFC was treated by the Clinton Adminstration, or how much opposition Elizabeth Warren of COP & CFBP or Shelia Blair of FDIC had, and in every case, they were exactly right, and the men opposing them were exactly wrong. I fear that is what she is running up against. There is a pattern here, I hate to say. I am becoming way too cynical these days.
Hi il,
In terms of RRSP, have your tried your argument for 5% penalty as you mentioned somewhere in your post? Have u opted out yet? I have a similar situation as yours. So your good news will mean a huge relief to me as well. Anyway, if money can buy a piece of mind, the it is worth it. (花钱消灾)
@Civic,
I have not heard from my agent yet since our last phone conversation. Here is what I plan to do…
If no penalty on RRSP — then I will pay the penalty on non-RRSP part, that will conclude my OVDI.
If they impose penalty on RRSP — they have to rejected my 9100 relief request first (see reference http://www.irs.gov/pub/irs-wd/1123024.pdf ). IRS has never rejected one single request outside OVDI, That is the fact. So if they decide to reject my 9100 relief request, they have to send me a letter in writing (with reasons !!!) . I will take this letter to TAS for help, this is not an offshore issue — it is a tax issue that IRS rejects taxpayers’ request who is in good faith to fix a very hidden form election problem ( 比脱裤子放屁还无意义的事！） — 80% Canadians living in US with RRSP are not aware of this form.
If they accept my 9100 relief request but still impose penalty on RRSP — that will also be a problem for them because they have stated in FAQ –that only accounts with unpaid tax should be included in base penalty. So they can not simply do that.
However, the worst, if they just say (according to one OVDI participant) ” RRSP should be included in penalty — this is the order from Washington” — then I will opt-out. And I will take a chance for huge penalty — but I think I can wear down IRS/DOJ all the way to the court — for me, it is free show time -:)
Am I being unreasonable ?