Offshore Tax Audits: High-Stakes Account Litigation: Early-on in our career, we were litigators. We represented clients across the globe with avoiding criminal prosecution and financial ruin. What we learned early on was this: Clients hate litigation. Whether it is pre-litigation, litigation, audits, or trials, it is almost never the best method for resolution in tax matters — especially FBAR related litigation.
Offshore Tax Litigation is on the rise. And, as any experienced international tax attorney will tell you, the most expensive type of FBAR Penalty may be the attorney’s fees a client pays for representation in court.
Offshore Tax Audits (High-Stakes Foreign Account Litigation)
Offshore Reporting and FBAR enforcement is convoluted at best. The FBAR is not even enforced through Tax Court. Rather, the IRS will file a lawsuit in Federal Court. The taxpayer must then defend the suit, and/or pay the debt and then sue for refund. It is a lose-lose for the client.
At Golding & Golding, we have a reputation for helping clients avoid the harrowing experience of being sued by the IRS in courts.
Clients Prefer a Quiet Resolution to their Case
Clients do not want to read about their case in the Newspaper. They do not want to have to go to court to defend a penalty for non-reporting of foreign accounts, which is a ridiculous penalty to begin with. Clients are not seeking to be a landmark victory case for the attorney’s reputation or ego.
Most Clients want an attorney who can resolve the matter before it explodes. The concept is the idea of putting out the fire when it is small, and before it turns into a raging inferno.
That is Golding & Golding’s specialty.
We draw on our past litigation and trial experience to help clients sidestep these issues safely, through Offshore Voluntary Disclosure.
As one of the most successful tax attorneys once quoted: “
The best victories in tax are the ones no one ever hears about.
When it comes to FBAR compliance and offshore compliance and disclosure, high-stakes matters generally take the form of audits and litigation — and typically involves pre-litigation such as an FBAR Audit/Eggshell situation, and not filing lawsuits.
An FBAR Audit Goes from Bad to Worse
The situation has become all too common:
A taxpayer is audited for a routine business matter. A general audit for something unrelated to foreign accounts. Then, after the initial audit, the taxpayer receives a second IDR (Information Document Request) that requests the following:
Any foreign bank account statements or income related to foreign assets.
In this type of situation, the stakes could not be higher.
Because more often than not, the examiner may have asked the taxpayer during the first part if the audit if they had foreign accounts. Scared, the Taxpayer responded, “No.” Meanwhile, the taxpayer has one or more foreign accounts, assets, or income overseas in the UK, Australia, India or Asia.
Or, after the initial audit, the examiner referred the case to their manager, who did their own research and located a foreign account or offshore income. Now the “simple” audit has morphed into a reverse-eggshell audit — which are highly dangerous.
Avoiding Litigation (Putting Out the Fire While it is Small)
- Does this taxpayer want their attorney to start filing lawsuits? No.
- Does this taxpayer want their attorney to be combative with the IRS Agent? No.
The taxpayer just wants the matter, resolved.
Many less experienced attorneys do not understand what litigation is. They think litigation only means filing lawsuits and going to trial, because that’s how they saw it done…in the movies.
These attorneys have never engaged in trial work, litigation or pre-indictment negotiations. Their inexperience leads them to be more combative with the IRS, and even other attorneys — to the detriment of the client…and to the attorneys themselves.
Don’t be misled by inexperienced counsel.
We inherit these types of cases all the time:
Golding & Golding (Board-Certified Tax Law Specialist)
We specialize exclusively in international tax, and specifically IRS offshore disclosure.
We have successfully represented clients in more than 1,000 streamlined and voluntary offshore disclosure submissions nationwide and in over 70-different countries. We have represented thousands of individuals and businesses with international tax problems.
We are the “go-to” firm for other Attorneys, CPAs, Enrolled Agents, Accountants, and Financial Professionals across the globe.
- Learn more about the Board-Certified Tax Lawyer Specialist credential
- Learn more about the Enrolled Agent credential
- Learn more about Golding & Golding’s Case Accomplishments
- Learn more about Golding & Golding Testimonials from prior clients
Less than 1% of Tax Attorneys Nationwide Are Certified Specialists
Sean M. Golding is one of less than 350 Attorneys (out of more than 200,000 practicing California Attorneys) to earn the Certified Tax Law Specialist credential. The credential is awarded to less than 1% of Attorneys.
Recent Golding & Golding Case Highlights
- We represented a client in an 8-figure disclosure that spanned 7 countries.
- We represented a high-net-worth client to facilitate a complex expatriation with offshore disclosure.
- We represented an overseas family with bringing multiple businesses & personal investments into U.S. tax and offshore compliance.
- We took over a case from a small firm that unsuccessfully submitted multiple clients to IRS Offshore Disclosure.
- We successfully completed several recent disclosures for clients with assets ranging from $50,000 – $7,000,000+.
How to Hire Experienced Counsel?
Generally, experienced attorneys in this field will have the following credentials/experience:
- Board Certified Tax Law Specialist credential
- Master’s of Tax Law (LL.M.)
- Dually Licensed as an EA (Enrolled Agent) or CPA
- 20-years experience as a practicing attorney
- Extensive litigation, high-stakes audit and trial experience
Interested in Learning More about Golding & Golding?
No matter where in the world you reside, our international tax team can get you IRS offshore compliant.
Golding & Golding specializes in FBAR and FATCA. Contact our firm today for assistance with getting compliant.
Sean holds a Master's in Tax Law from one of the top Tax LL.M. programs in the country at the University of Denver. He has also earned the prestigious IRS Enrolled Agent credential. Mr. Golding's articles have been referenced in such publications as the Washington Post, Forbes, Nolo, and various Law Journals nationwide.