Thursday, May 19, 2011

IRS will be targeting American Arabs

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IRS will be targeting American Arabs

MILWAUKEE, WI May 18th, 2011

 April 15th has come and gone but the IRS estimates there are tens of thousands of Americans with unreported foreign bank accounts. Penalties for not reporting an account in a foreign country include prison and loss of 50% of the highest balance in the account.

In 2009, the IRS offered an amnesty program for those with unreported foreign bank accounts. Only 15,000 people came forward. This year, the IRS says that the 2011 program - called the Offshore Voluntary Disclosure Initiative - is the last chance to avoid possible prosecution and huge penalties.

Opening an account in a foreign country is not illegal. Not reporting the income from that account or simply not disclosing the account can be a felony.

Many foreign born residents simply think they are sending money "home." They forget that the IRS considers their home bank account to be a foreign one.

Arab Americans represent one of the wealthiest and fastest growing groups of foreign-born nationals within the U.S. They are also ripe for becoming a target of the government’s crackdown on unreported foreign bank accounts.

Prominent U.S. tax attorney Brian Mahany says, "The world is getting much smaller. The risk of getting caught with an unreported offshore account is at an all time high. Those that choose to play the 'audit lottery' this year will probably lose."

Residents have until August 31st to participate in the amnesty but there is a catch. All reports, amended returns, payments and paperwork must be complete by that date. Mahany urges people who plan to participate to not wait until the last minute. Experts say the paperwork required to complete the amnesty program will take most people at least 30 days. Wait until the last minute and it may be too late.

Mahany & Ertl is a boutique law firm concentrating in Tax Resolution, Fraud Recovery and White Collar Criminal Defense. We represent businesses and individuals throughout the United States. For further information, please call us at (414) 704-6731 or go online to