I have attempted to gather the comments on this subject, identified by comments from Neill, so they will be in one place for further discussion by those able to review:
November 13, 2014 at 11:10 am
This has got to be worth digging into: http://finance.yahoo.com/news/brager-tax-law-group-obtains-182000920.html
FOIA request on OVDP dump. Not locked.
On OVDP dump. First document has great cartoons in it.
This is a powerpoint of the IRS bragging about them bowing UBS
That first document clearly shows that it’s all a big joke inside the IRS. See that PowerPoint an the picture on page 78. It shows a massive chalk board filled with equations and diagrams. Caption says ‘Clearly this taxpayer qualifies for the 5% penalty’. Other pictures show taxpayers doing hurdles to get into these groups.
We need a coordinated effort were we give a person a doc to skim through and we keep track of what’s been looked at. We will be ready this way for when there is a class action lawsuit. Maybe we find something to give to the press.
Tricia Moon says
November 14, 2014 at 9:36 am
Thanks for bringing this to my attention. I have not heard of it before. For those who want to start reading: http://www.bragertaxlaw.com/previously-unreleased-irs-guidelines-for-fbar-audits.html
No Word says
November 14, 2014 at 10:09 am
Can someone bring this treasure trove to the attention of Allison Christians. I think someone of her calibre is able to make sense of what has been released.
YES, I agree — would be good to have a legal eye looking if possible and Tricia has forwarded to Allison as requested.
Finally from badger, today: http://isaacbrocksociety.ca/2012/01/28/the-ovdi-drudgery-for-minnows/comment-page-23/#comment-4272818
From find by Neill and posted on another thread http://isaacbrocksociety.ca/media-and-blog-articles-open-for-comments/comment-page-73/#comment-4244472
and entire list of documents obtained:
Importantly, as badger points out:
Note, this is just an FYI, not an endorsement of any kind or advertising the law firm who made the FOIA request and posted it on their site.
Cross-posting this comment from Dash1729, http://isaacbrocksociety.ca/2014/11/12/attempt-to-contact-commander-chris-hadfield-with-u-s-defined-u-s-personhood-by-snowbird-rules/comment-page-2/#comment-4275603
That document is quite a tome. I love the quote from page 76:
“On October 31, 2008, [Howard Humboldt] gave in to his urge to return to his motherland.”
They make it sound like returning to a country outside the USA is some kind of a character flaw or vice on a par with drinking too much booze or smoking too many cigarettes.
This stuff will make you mad. I have skimmed through quite a lot. They think it’s all a big joke. They have to give a huge amount of training to their employees to audit the stuff that ordinary people have to understand (PFIC, foreign tax credits etc). They clearly plan to go after a large group of people. Visa owners, green card holders, athletes, students, snow birds and US persons abroad.
They have detailed info on how to spot PFIC so they can really do a number on people (look for ICVC etc).
I am seeing information that’s quite useful. I had never heard of the ‘three bite rule’ for tax on people covered by the saving clause.
The cartoons might be funny if you hadn’t read all their stuff about sticking it to people who didn’t even know they were American.
The IRS is a government agency and as such it cannot be made efficient, it cannot be made honest, it cannot be made non political, it simply must be made history. We FairTaxers believe they spend several billion dollars of taxpayer (borrowed) money that should not be spent at all. The 23% FairTax is the only tax we should be paying. I know you think 23% is high, but it is actually a tax cut. You now Pay 7.65% of your pay as Social Security tax, you pay more per gallon in gasoline taxes than the station owner gets as a profit margin. Depending on your income you can pay as high as 39% income tax. Here is the kicker. Every company actually pays about 15% of their sales as a Federal Income tax and they spend about 15% as tax accounting expense. Added together and added to the cost of manufacturing they add about 30% cost of taxes into the product. All that disappears if we get the FairTax. Nuff said!!!!
Just the amount of training we’ve seen over the past few years, including extensive seminars, is, to me, mind-boggling. At the costs for both putting these training sessions on and the fees charged for those attending / being trained shows us the teeth and exploitation planned with FATCA and the IGAs our countries have signed. Neill, I hope you and others have the time and expertise to continue to analyze what you’re reading. Then what — i.e, is any of this information useable in litigation?
What really makes me angry is that they present all this detailed info to their agents, but none of it to taxpayers! Where in the usual IRS documentation aimed at ordinary overseas filers is the information on how to figure out what would be considered a PFIC? Where is the word PFIC even mentioned? It all seems set up like a trap for the unwary.
And 5% penalty for people who didn’t even know they were citizens? How can they consider that right? How can these scumbags look at themselves in the mirror?
This might just be my contempt speaking, but they seem to have a plethora of traps for the unwary. Almost too many to be considered a coincidence. I personally have walked headlong into a couple of them to my extreme detriment. I dare say, that without information gleaned from this website, I would have probably walked right into a few more. Thank you one and all for shedding some light in a very dark place.
The OVDP dump mentioned is about OVDP, only interesting for those who have signed up for that
Just mentions how they will apply penalties,much of what is in the FAQs
The cartoons indeed show that they are proud of blowing up the banks of other countries.
From the entire list
“Question taxpayer regarding history/reason for offshore accounts.”
Tells what happens to a person after being FATCAd.
Question taxpayer regarding history/reason for offshore accounts. Where did idea/decision come from to set up foreign bank accounts/foreign assets.
Foreign Assets – • Bank Accounts – financial institution; account #; approximate balance; year opened; how and why was it opened (purpose); opening balance; nature of deposits (business income/transfers); type of deposits (cash, wire, through an advisor); have accounts been closed/ why; accounts held in another’s name for benefit of taxpayer. • Brokerage accounts – communication/correspondence with broker (direct/indirect-through other entity/individual); direct the investment advice; tax advice received; income associated with this account; Owners of this account (direct and indirect); management fees paid; any beneficial owners; account disclosed to return preparer. • Entities (Corporation, Partnership, Foundation, Trust) ownership in foreign entities (go through filing requirements for F5471, F8865, F352, F3520A) for any entity that taxpayer owns – date of creation, still in existence, questions regarding the creation (purchased, created, when, where, processed followed, any advice received-from who) purpose of entity, other owners/partners/shareholders/ beneficiary/trustee/grantor; country of incorporation/organization; funding of entity; additional money transferred to the entity (when, how much, source of funds) • Real Estate – location, title of property (individually or through an entity) when purchased, when sold, approximate value, source of funds to purchase asset, any income associated with the assets, purpose of the asset (personal/investment) • Precious Metals –sales; income from these assets; how were they acquired (source of funds); how are these assets held- bank account/safe deposit box; are they actually precious metals or shares of precious metals. • Jewelry/Art/Other Assets- sales; income from these assets; how were they acquired (source of funds); how are these assets held- bank account/safe deposit box; custodian of the assets/are they actually precious metals or stock shares of precious metals.
Travel • Foreign travel – detail each trip and discuss the purpose/duration/multiple destinations • banks visited; accounts created; visit with professionals (attorney / accountant / banker); discuss legal and/or financial matters • (request a TECS [Treasury Enforcement Communications Systems] transcript at the beginning of the case so that you can have it prior to interview to be able to verify the taxpayer’s answers and gauge the taxpayer’s honesty and/or ask specific travel questions during the interview.)
Preparation of the Return • Contact information for return preparer and other tax/financial professionals
• Return preparer’s qualifications • Documents/information provided to preparer – number of meetings with preparer and topics discussed. • Offshore transactions – what was disclosed to the preparer • Questions asked by return preparer in order to prepare tax return; tax questionnaire completed; were offshore issues addressed. • Why omission of foreign items that were similar to domestic items reported on return (i.e. interest, dividends, capital gains, etc.) • Any professional advisors (financial advisors, accountants, attorneys, etc) aware of foreign accounts/transactions; advice received.
Filing of Quiet Disclosure • Reason for filing quiet disclosure • Knowledge of OVDI – why filed a quiet disclosure and not OVDI; when learned of OVDI/ filing requirements.
FBAR • Understanding of TD F 90-22.1-how and when learned about this form. • Discussions with professional advisors (financial advisors, accountants, attorneys, etc) • Taxpayer’s understanding of filing requirements • Filing history of TD F 90-22.
From the entire list
FBAR reasonable cause
Gives an idea of what they write is reasonable cause.
However, in the past, reasonable cause and filing issues have in history been quite forgiving. All of this training seems to mean that the leadership is training the staff to be bigger assholes, because they’ve found out that they’ve previously been too human.
Some of those look like reasonable cause to me.
How could being uninformed/misinformed not be reasonable cause??
Yet, the IRS seems to recognise here that there might have been a problem with the preparers not asking enough questions.
“We understand that individuals required to file FBAR are defending against penalty impositions
by blaming their preparers, on whom they reasonably relied, for failing to ask about the existence
of a foreign bank account or to advise that an FBAR was required. As a result, some practitioners
have expressed concerns about their duties and responsibilities under Circular 230 with respect
to both the responses required on Schedule B and the preparation and filing of the TDF 90-22.1
Not that Lisa had discussed on various threads that reasonable cause has been quite friendly in (previous) practice. I don’t know if this text is new or has always been there.
You never know.
When we were kids, we used to read those No Trespassing signs which threatened all kinds of things. As 10 yr olds, we once even called the police on somebody on an empty lot because we took it seriously.
Living in the states I was always hardened to it and always laughed it off, but now?
OMG, just the first of your find, Mark Twain:
They friggin are not FOREIGN to me. I live and am a citizen of the country in which my bank and investment accounts reside. My son was born here. We, you unthinking and with not a shred of morality robots, are NOT “US citizens who happen to reside in Canada”!!!
@Calgary411 “We, you unthinking and with not a shred of morality robots, are NOT “US citizens who happen to reside in Canada”!!!
That there is righteous anger. 🙂
@Calgary411, What do you of this one?
If a return is required under the statute and regulations, the mere uninformed belief that no return is due, no matter how genuine, is not reasonable cause.
It boggles the mind that ANYONE (but a robot or a person who TORTURES in the name of the USA) could formulate such verbiage, let alone believe it and put it into policy. It reeks to the high heavens!
What I’ve read/skimmed makes me so angry. The documents show that the whole point is to entrap and generate revenue via penalties – even in the absolute absence of US tax assessable. And to generate revenues out of all proportion to any US tax assessed and charged as owing.
As the Taxpayer Advocate said publicly last month;
“”…. Again, that comes back to that proportionality issue,” Olson said. “So you’re really looking at this and thinking, why are we doing this to folks? Why are we tormenting them in this way?….””
The same thought keeps coming back to me…I don’t have any foreign bank accounts. If I had an account in the U.S., that would be foreign. Reading that whole piece has made me livid and hardened my resolve. (Thanks Mark Twain for posting it). How about “Foriegn travel- detail each trip and discuss the purpose/ duration / multiple destinations” ??? How, exactly, is that any business of theirs? Did they forget to ask if I fraternised with the locals? I’ve been to 42 countries, some of them multiple times. Even though that would hardly raise an eyebrow here, to the average American, it would be enough to have me burned as a witch. It would brand me as a suspicious person at the very least.
I’m grateful again for the learning I’ve recieved courtesy of this site. If I had not read that particular piece, I may have been silly enough to think that the truth might set me free.
I keep coming back to that same conclusion. Almost everything is meant to entrap. If they don’t understand any answer, it’s obviously a lie. They seem to have all the bases covered in their approach and are well versed in twisting your answers to prove maximum guilt. After my first OMG moment I thought I could explain my situation to someone because I really hadn’t done anything wrong. Boy, talk about living in a fools paradise! It’s not about innocence or guilt, it’s about the State Department holding you down while the IRS rifles through your pockets. Tony Soprano would be proud of these guys.
IRS clearly does not want regular audits for these cases:
No year on this doc. But this bit clearly irrelevant for overseas:
There is even concern about people who pay more tax than they need to abroad (example from Switzerland of all places):
Foreign trips? Well to the IRS we all live in foreign countries so I guess they want us to know the details of every road trip we take outside our home city/town. Too ridiculous for words.
So I have a question. Why would anyone in their right mind (and determined to NEVER travel to the USA) ever answer any IRS question? If they want answers let them find them on their own.
All those questions could be taken care of by simply saying, “I dunno — ask the NSA — they know everything.”
For those who are trapped within the prison walls of the USA I think we may have to consider helping them escape, even though an underground railroad will be far more difficult to set up than in the 19th century.
@ Duke of Devon
Any thoughts on this?
I live 25 kilometres out of town, so they better give me a very big form to fill out.
But seriously, I totally agree. Why would you even play the game? It’s obviously a stacked deck. I was hoping that there may be a chance to smooth things over so that I could still visit the U.S. but that’s looking more and more unlikely. I’m pretty much up to the “Come and get me coppers” stage. The irony here is that I would spend on average of around $5000 of foreign currency on each of my trips there. Reading posts here over the last week has strengthened my resolve and I don’t intend to answer any questions to the IRS. Any answers will be twisted and used against me. This has been the case at each step so far, so only wishful thinking would suggest that that’s going to change. All letters will be ignored, all phone calls will be disconnected, and if they have the hide to pay me a visit I might forget to tell them to be mindful of a couple of Tai Pans that have been loitering near the house recently.
I believe that anyone should think twice about answering questions that will aid them in their bogus investigations. You will not curry favour with them, only provide short cuts.
Does Nina Olsen know about this? Taxpayers Advocates should be informed. This is truly despicable.
The dice are loaded.