Practical Advice for Late FBAR Filing by an Offshore Specialist

Practical Late FBAR Filing Advice from a Board-Certified Tax Specialist

Practical Late FBAR Filing Advice from a Board-Certified Tax Specialist

At Golding & Golding, our international tax law firm specializes exclusively in offshore disclosure and expatriation tax matters. We have represented thousands of taxpayers in over 80 countries with FBAR, FATCA, and other international tax-related matters. Unfortunately, over the past 5-to-10 years, a new crop of tax attorneys has emerged; they have little to no actual offshore experience but use the Internet to portray themselves as being experts and even ‘Board-Certified Tax Law Specialists,’ even though they are not Board-Certified. These are the same type of attorneys who claim to have a firm with 40-to-50 years of experience, but in reality it is just 10 to 15 attorneys with a few years of experience each. Here are five pieces of practical advice for filing a late FBAR or other international information reporting form.

First, it is Not As Bad As You Think it is

It is not uncommon for taxpayers to have several years of missed foreign account reporting before they learn about their non-compliance. It is also very important to note that the IRS has developed various offshore/FBAR amnesty programs to assist taxpayers with getting into compliance, and more often than not the situation is nowhere near as bad or dire as these attorneys want you to believe.

Take a Step Back Before Reaching out to Tax Attorneys

While your immediate knee-jerk reaction will be to race around the internet trying to find all the information you can and engaging in as many free consultations as you want, it is important to first get an idea of what the situation is and to research the different firms before reaching out to a firm just because they offer free consultations.

*Getting bad information can set you in motion to having a very costly and unsuccessful offshore disclosure experience.

‘Free’ Consultations are not Really Free

Keep in mind that free consultations are not free. While you are not paying for the consultation at the time you are on the call, oftentimes these attorneys will bake these fees back into representation if you decide to retain the firm.

We had a few clients reach out to us about one specific attorney who offered free initial consultations but then actually went back and charged the taxpayer as part of the initial bill the taxpayer received — so in essence, the taxpayer’s reward for hiring the firm based on a free consultation is for the attorney to charge them for the initial ‘free call’ during the representation process.

Educate Yourself a Bit Before Speaking with Lawyers (This will Help You Immensely)

Offshore disclosure is a vast area of tax and immigration law. With that said, by conducting some preliminary research, you can have a general idea of what information the attorneys may want to know and what your situation is. For example, just having a general idea of the different types of forms that are required along with the different programs that are available will help put you in a much better position during the initial consultation process.

Do Not Compare Yourself to Others (You Already Know This)

A lot of attorneys, especially those offering free consultations, are fear-mongers who use scare tactics to make you believe that your situation is infinitely worse than it really is. If you are a tax-abiding citizen who simply didn’t know about FBAR reporting and failed to report a few accounts in your home country, do not compare yourself to a taxpayer with undisclosed offshore companies generating untaxed income in tax haven locations. Those facts are not similar to your facts — and the strategies and outcome in those cases would not mimic the outcome in your case.

Important Tip! Vet Your FBAR Attorney Properly

Unfortunately, tax attorneys can claim many things online that are not true. Some tax attorneys will claim that they are FBAR experts simply because they generate AI videos to make themselves appear as if they know what they are talking about. Some of these same Attorneys will claim to be a specialist — and even a board-certified specialist — because they don’t think you will check their credentials. Any attorney that claims they are board-certified specialists must be designated and licensed as a board-certified tax law specialist in at least one state and by the State Bar.

You must check the credentials of the attorneys you are considering hiring because once you’ve already paid the attorney, the type of attorney that uses mental gymnastics to make it appear they are a specialist or an expert when they are not is typically not the type of attorney that is going to refund you any of the fees based on the misrepresentation they made of their experience and license status.

Late Filing Penalties May be Reduced or Avoided

For Taxpayers who did not timely file their FBAR and/or other international information-related reporting forms, the IRS has developed many different offshore amnesty programs to assist Taxpayers with safely getting into compliance. These programs may reduce or even eliminate international reporting penalties.

Current Year vs. Prior Year Non-Compliance

Once a taxpayer misses the tax and reporting (such as FBAR and FATCA) requirements for prior years, they will want to be careful before submitting their information to the IRS in the current year. That is because they may risk making a quiet disclosure if they just begin filing forward in the current year and/or mass filing previous year forms without doing so under one of the approved IRS offshore submission procedures. Before filing prior untimely foreign reporting forms, Taxpayers should consider speaking with a Board-Certified Tax Law Specialist who specializes exclusively in these types of offshore disclosure matters.

Avoid False Offshore Disclosure Submissions (Willful vs Non-Willful)

In recent years, the IRS has increased the level of scrutiny for certain streamlined procedure submissions. When a person is non-willful, they have an excellent chance of making a successful submission to Streamlined Procedures. If they are willful, they would submit to the IRS Voluntary Disclosure Program instead. But, if a willful Taxpayer submits an intentionally false narrative under the Streamlined Procedures (and gets caught), they may become subject to significant fines and penalties. 

Need Help Finding an Experienced Offshore Tax Attorney?

When it comes to hiring an experienced international tax attorney to represent you for unreported foreign and offshore account reporting, it can become overwhelming for Taxpayers trying to trek through all the false information and nonsense they will find in their online research. There are only a handful of attorneys worldwide who are Board-Certified Tax Specialists and who specialize exclusively in offshore disclosure and international tax amnesty reporting. 

*This resource may help Taxpayers seeking to hire offshore tax counsel: How to Hire an Offshore Disclosure Lawyer.

Golding & Golding: About Our International Tax Law Firm

Golding & Golding specializes exclusively in international tax, specifically IRS offshore disclosure.

Contact our firm today for assistance.