False Tax Return, Unreported Foreign Income & No FBAR – Jail & Fines
In late 2018, Israel Birman pled guilty to filing a false tax return. One of the main components of the crime was the failure to report foreign accounts on the FBAR.
“According to court documents, between 2006 and 2014, Israel Birman held offshore bank accounts in Israel at Bank Leumi and Israel Discount Bank.
The accounts had balances over $10,000 each year, which required the filing of Reports of Foreign Bank and Financial Accounts (FBARs) with the Department of the Treasury.
In 2013, Israel Birman’s bank accounts at Israel Discount Bank had a total value of over $3.4 million. Israel Birman did not file FBARs for 2006-2014.
Israel Birman instructed Bank Leumi to hold bank mail from delivery to the United States, and obtained access to his offshore funds through the use of “back-to-back” loans from Bank Leumi USA collateralized by his undeclared Bank Leumi offshore funds.
In 2009 and 2010, Israel Birman earned taxable interest income on his Bank Leumi bank accounts totaling over $187,000. He failed to report that interest income on his 2009 and 2010 federal tax returns.”
The Day of Reckoning (Jail and Fines)
For nearly 10 years, Israel Birman did not file FBARs – despite his foreign accounts exceeding $3M.
In early February (2019), Israel Birman was sentenced to 6 months in jail, along with the 1 year of supervised probation.
In addition to serving time in jail, Israel Birman was required to pay an FBAR penalty of $1.7 million – which represented a 50% penalty on the maximum balance from 2013.
Safely Get Into IRS Offshore Compliance
Presuming the money was from legal sources, your best options are either the Traditional IRS Voluntary Disclosure Program, or one of the Streamlined Offshore Disclosure Programs.
Golding & Golding, A PLC
We have successfully represented clients in more than 1000 streamlined and voluntary disclosure submissions nationwide, and in over 70-different countries.
We are the “go-to” firm for other Attorneys, CPAs, Enrolled Agents, Accountants, and Financial Professionals across the globe.