ആനംസ്റ്റി പ്രോഗ്രാം മൂന്നാം തവണയും കൊണ്ടുവന്നത് പൊതുവില് ഗുണകരമാണ്. പക്ഷെ ഫോം 8938-ന്റെ വരവ് അത്ര ശുദ്ധോദര്ക്കമല്ല. അതിനു പുറമെ ലോകത്തെവിടെയുമുള്ള ബാങ്കുകളുമായും കരാറുണ്ടാക്കാനും ഐ.ആര്.എസ് തീരുമാനിച്ചിരിക്കുന്നു. പ്രസ്തുത ബാങ്കുകളില് അമേരിക്കക്കാര്ക്കും ഇവിടുത്തെ റസിഡന്റ്സ് ആയിട്ടുള്ളവര്ക്കും മറ്റുമുള്ള സ്വത്ത് സംബന്ധിച്ച വിവരം നേരിട്ട് ഐ.ആര്.എസിനെ അറിയിക്കാനും, ടാക്സ് ബാങ്ക് തന്നെ പിടിച്ച് യു.എസ് ട്രഷറിയില് അടയ്ക്കുകയും ചെയ്യുക എന്നതാണ് ഇതുകൊണ്ട് ഉദ്ദേശിക്കുന്നത്. അമേരിക്കയിലെ ബാങ്കുകള് ചെയ്യുന്ന രീതിയില് ലോകത്തെവിടെയുമുള്ള ബാങ്കുകളേയും ഉപയോഗപ്പെടുത്തുകയാണ് ലക്ഷ്യമിടുന്നതെന്ന് ന്യൂയോര്ക്കിലെ റോക്ക്ലാന്റ് കൗണ്ടിയില് സര്ട്ടിഫൈഡ് അക്കൗണ്ടന്റായ ജയിന് ജേക്കബ് ചൂണ്ടിക്കാട്ടുന്നു.
ആദ്യ പ്രോഗ്രാമില് പിഴ 20 ശതമാനമായിരുന്നു. രണ്ടാമത്തേതില് അത് 25 ശതമാനമായി. ഇപ്പോഴത്തേതില് 27.5 ശതമാനം ഇതോടൊപ്പം എട്ടുവര്ഷത്തെ ഏറ്റവും ഉയര്ന്ന തുകയുടെ ടാക്സുമെല്ലാം കണക്കുകൂട്ടി നോക്കുമ്പോള് വിദേശ വരുമാനത്തിന്റെ പകുതിയോളം ഐ.ആര്.എസിനു കൊടുക്കേണ്ടി വരും. കൊടുത്തില്ലെങ്കില് ഐ.ആര്.എസ് പിടികൂടിയാല് പിഴ കൂടുമെന്നു മാത്രമല്ല. ജയിലിലും പോകേണ്ടിവരും. ഐ.ആര്.എസ് പിടികൂടില്ലെന്ന് ഉറപ്പിക്കുകയും വേണ്ട.
വിദേശത്ത് പ്രതിവര്ഷം 10,000 ഡോളറിലേറെ വരുമാനം ലഭിക്കുന്നവരാണ് അത് വെളിപ്പെടുത്തേണ്ടത്. അത്രയും വരുമാനമില്ലാതെ ഭൂമിയോ കെട്ടിടമോ ഒക്കെ കൈവശമുള്ളവര് റിപ്പോര്ട്ട് ചെയ്യണമെന്നില്ല. (വിശദാംശങ്ങള്ക്ക് ടാക്സ് അറ്റോര്ണിയേയോ, അക്കൗണ്ടന്റിനേയോ സമീപിക്കുക).
വിദേശത്തു പണമായോ, സ്റ്റോക്കിലോ, ഇന്ഷ്വറന്സിലോ, പെന്ഷന് ഫണ്ടിലോ അരലക്ഷം ഡോളറില് കൂടുതല് ഉള്ള വ്യക്തികളാണ് ഫോറം 8938 പൂരിപ്പിച്ച് നല്കേണ്ടത്. ഭാര്യയും ഭര്ത്താവും ഒരുമിച്ച് ടാക്സ് ഫയല് ചെയ്യുകയാണെങ്കില് ഒരുലക്ഷം ഡോളറില് കൂടുതല് വിദേശ സ്വത്തുണ്ടെങ്കില് ഫോറം 8938 പൂരിപ്പിക്കണം.
കാര്യമായ വരുമാനമില്ലാത്ത ഭൂമി, കെട്ടിടം, അപ്പാര്ട്ട്മെന്റ്, വാഹനങ്ങള്, ആഭരണങ്ങള്, ആര്ട്ട് കളക്ഷന്സ് എന്നിവ വെളിപ്പെടുത്തേണ്ട വിദേശ സ്വത്തില് ഉള്പ്പെടുന്നില്ല.
യു.എസ് പേഴ്സണ്സ് ആണ് ഫോറം 8938 ഫയല് ചെയ്യേണ്ടത്. യു.എസ് പൗരന്മാര്, റസിഡന്റ്സ്, ഏലിയന്, നോണ് റസിഡന്റ് ഏലിയന് എന്നിവരൊക്കെ ഫോറം പൂരിപ്പിക്കണം.
ഫോറത്തില് കുടുക്കാനുള്ള ചോദ്യങ്ങളുണ്ട്. വിദേശ ബാങ്കില് അക്കൗണ്ട് ഉണ്ടെന്നു പറഞ്ഞാല് എന്നാണത് തുടങ്ങിയതെന്ന് എഴുതണം. നേരത്തെ തുറന്ന അക്കൗണ്ടാണെങ്കില് അതിനു മുന്കാലത്ത് ടാക്സ് കൊടുക്കാതിരുന്നതെന്ന ചോദ്യം വരാം.
കൂടുതല് വിവരങ്ങള്ക്ക്: www.irs.gov
TIMES OF INDIA
New IRS form affecting Indian Americans
Deepa Venkatraghvan | Feb 16, 2012, 08.18PM IST
As if the various filing requirements were not enough, the
US Internal Revenue Service (IRS) has added one more form to collect
information from its citizens and residents on their foreign financial assets.
With effect from 2012, the IRS has introduced 'Form 8938 - Statement of
Specified Foreign Financial Assets' to be filed along with the income tax
return. That is, all those filing their tax returns of 2011 will have to
include Form 8938, if applicable to them. This form, which has already earned
synonyms like 'Son of FBAR' and 'FBAR Turbo,' will be in addition to the
already existing requirement of Foreign Bank and Financial Accounts Report (FBAR)
that must be filed by June 30th each year.
Parag Patel, an attorney and Partner at New
Jersey based Patel Law Offices says, "Form 8938 is and will
be a significant tool for the IRS to identify the scope of international tax
non-compliance of a given US
taxpayer. The reason why Form 8938 is so useful for the IRS is that Form 8938
now requires a taxpayer to disclose more information, which connects various
parts of a taxpayer's international tax compliance including the information
that escaped disclosure on other forms earlier."
"This summary, in turn, allows the IRS to effectively
identify the overall scope of a taxpayer's noncompliance. Form 8938 may lay the
foundation (and road map) for an IRS investigation of whether the taxpayer has
been in compliance previously. For example, Question 3a of Form 8938 indirectly
asks a problematic question: the date of the account opening (the question
specifically asks whether the account was opened in the tax year). For older
accounts, this is a dangerous question. Answering that the account was not
opened in the tax year, implicitly (and affirmatively by omission) states that
account was opened in a prior year. As a result, prior years FBARs should have
been filed. The answer to question 3a could provide incriminating evidence to
the IRS," Patel explains.
The IRS is tracking foreign accounts in all countries, but
thanks to recent indictments of account holders in countries like Switzerland and India (several HSBC India account
holders have been indicted), there could be increased focus on these countries.
Given the serious implications of Form 8938, let's look at
its applicability so you do it right when you file your taxes for 2011.
Who must file Form 8938? You must file Form 8938 if: 1. You
are a specified individual AND 2. You have an interest in specified foreign
financial assets required to be reported AND 3. The aggregate value of your
specified foreign financial assets is more than the reporting thresholds that
applies to you
1. A specified individual is:
- A US citizen - A resident alien of the United States for
any part of the tax year (you can find a definition of resident alien in this
article) - A nonresident alien who makes an election to be treated as resident
alien for purposes of filing a joint income tax return - A nonresident alien
who is a bona fide resident of American Samoa or Puerto Rico 2. A specified
foreign financial asset is: - Any financial account maintained by a foreign
financial institution. A foreign financial institution includes bank account,
investment vehicles such as foreign mutual funds, foreign hedge funds, and
foreign private equity funds. - Other foreign financial assets held for
investment that are not in an account maintained by a US or foreign
financial institution. Examples of other specified foreign financial assets
include stock issued by a foreign corporation, a capital or profits interest in
a foreign partnership, a note, bond, debenture, or other form of indebtedness
issued by a foreign person, an interest in a foreign trust or foreign estate,
an interest rate swap, currency swap, basis swap, interest rate cap, interest
rate floor, commodity swap, equity swap, equity index swap, credit default
swap, or similar agreement with a foreign counterparty and an option or other
derivative instrument with respect to any of these examples or with respect to
any currency or commodity that is entered into with a foreign counterparty or
You would therefore have to report all your share holdings,
mutual fund holdings, ULIP and insurance policy holdings, pension plans and
bank balances in India.
Specified foreign financial assets do not include physical
assets such as gold and real estate. However, if gold is held in the form of
ETFs, it would be included as specified foreign financial asset.
3. The reporting thresholds that apply are as follows: -
Unmarried taxpayers living in the US: The total value of your specified foreign
financial assets is more than $50,000 on the last day of the tax year or more
than $75,000 at any time during the tax year - Married taxpayers filing a joint
income tax return and living in the US: The total value of your specified
foreign financial assets is more than $100,000 on the last day of the tax year
or more than $150,000 at any time during the tax year - Married taxpayers
filing separate income tax returns and living in the US: The total value of
your specified foreign financial assets is more than $50,000 on the last day of
the tax year or more than $75,000 at any time during the tax year. - Taxpayers
living abroad: You are filing a return other than a joint return and the total
value of your specified foreign assets is more than $200,000 on the last day of
the tax year or more than $300,000 at any time during the year or you are
filing a joint return and the value of your specified foreign asset is more
than $400,000 on the last day of the tax year or more than $600,000 at any time
during the year.
How to determine value of specified financial assets? You
must report the maximum value during the tax year of each specified foreign
financial asset reported on Form 8938. You may rely on periodic account
statements for the tax year to report a financial account's maximum value.
Use the currency exchange rate on the last day of the tax
year to figure the maximum value of a specified foreign financial asset or the
value of a specified foreign financial asset for the purpose of determining the
total value of your specified foreign financial assets to see whether you have
met the reporting threshold.
Here's what this really means. Suppose you are a single
taxpayer in the US
and you had a balance in your demat account worth $50000 on December 31, 2011.
You qualify to report Form 8938. But what you actually report in Form 8938 will
be the highest value in your demat account during 2011. So suppose you held
shares worth $55000 during 2011 but sold off some shares due to which the
balance dropped to $50000, you must report $55000 in Form 8938.
What is the due date for filing Form 8939? Form 8938 must be
filed along with your income tax return. For US tax year 2011, the due date is
April 17th 2012.
Is Form 8938 in addition to FBAR? Yes. In recent years, the
IRS has increased its focus on tracking offshore accounts for possible tax
evasion. This new Form 8938 is just one more measure in that direction. In
short, today, if you are a US
resident or US citizen with
bank and financial accounts in countries outside the US, you will have several reports
to file. Your US
tax return, 1040, itself has questions about your foreign financial interests
in Schedule B. Then you have this new Form 8938 that must be filed along with
your tax return. And finally you have the FBAR that must be filed by June 30th
each year for the previous tax year.
The FBAR and Form 8938 collect more or less the same kind of
information with a few differences. Read more about FBAR here.
While Form 8938 itself is not very complicated, the filing
process might be cumbersome. For instance, while reporting share holdings in
Indian companies in Part II of form 8938, you would need to list each company's
holding separately giving details of not just the shareholding but address of
the company, dividends received and where you reported the income on your 1040.
Consult a professional to make sure you don't leave out any important details.
U.S. OFFSHORE VOLUNTARY DISCLOSURE PROGRAM REOPENED 2012 (OVDI 2012)
On January 9, 2012 the Internal Revenue Service (“IRS”) reopened the offshore voluntary disclosure program (“OVDP”). The program is similar to the 2011 OVDI program which ended September 9, 2011. The penalty’s associated in the new program have increased and the penalty framework requires individuals to now pay 27.5%, up from 25%, of the highest aggregate balance in their foreign bank accounts over the eight year required filing period. Some taxpayers may be eligible for a reduced penalty rate of 5% or 12.5% depending on their specific situation.
Foreign Asset Reporting Update
Reporting of foreign asset ownership may require filing more than one form starting this filing season.
Enacted in 2010 as part of the Hiring Incentives to Restore Employment (HIRE) Act, the Foreign Account Tax Compliance Act (FATCA) is an attempt to minimize tax evasion by United States taxpayers holding investments in offshore accounts. The reporting provisions of FATCA are being phased in over the next few years to require U.S. taxpayers, as well as foreign financial institutions, to report directly to the IRS the ownership interests of certain financial interests.
U.S. Taxpayers Holding Foreign Financial Assets
FATCA requires certain U.S. taxpayers holding foreign financial assets with an aggregate value exceeding $50,000 to report certain information about those assets on a new form (Form 8938, Statement of Specified Foreign Financial Assets) that the taxpayers must attach to their annual tax returns. For most taxpayers, the first use of this form will be as part of the 2011 tax return filed during the 2012 tax filing season. Failure to report foreign financial assets on Form 8938 will result in a penalty of $10,000 (and a penalty up to $50,000 for continued failure after IRS notification). Further, underpayments of tax attributable to non disclosed foreign financial assets will be subject to an additional substantial understatement penalty of 40% Although the IRS anticipates issuing regulations to include domestic entities in the filing requirement, if the entities are formed or availed of for purposes of holding, directly or indirectly, specified foreign financial assets, as of this date the filing requirement of Form 8938 applies only to individuals.
Form 8938 Does Not Replace FBAR Filing Requirements
The reporting of foreign financial accounts on Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts (FBAR), is required under Title 31. Certain foreign financial accounts are reported on both Form 8938 and FBAR. However, the information required by the forms is not identical in all cases. Different rules, key definitions, and reporting requirements apply to Form 8938 and FBAR reporting. Because of these differences, taxpayers may be required to report certain foreign financial accounts on one but not both forms.
Because they serve different law enforcement purposes, Form 8938 and the FBAR require different categories of persons to file, have different filing thresholds for Form 8938 (i.e., minimum $50,000 threshold) and FBAR reporting (i.e., $10,000 reporting threshold), and require different assets, as well as accompanying information, to be reported on each form.
For FBAR purposes, a filer (defined broadly as a U.S. person, so it applies to individuals as well as to all types of entities) must report a financial account if the filer had a financial interest or signature authority in the financial account during the previous calendar year. Financial interest for FBAR purposes is based on whether the person is the owner of record for, or holds legal title to, the financial account. Signature authority is the authority of a person to dispose of assets held in a financial account.
For purposes of filing Form 8938, an individual has an interest in the financial account if potential tax attributes or transactions related to the account would be reported on the individual’s tax return. The concept of signature authority does not apply for purposes of Form 8938 requirements.
In certain instances, FBAR reporting is required by persons who do not have a direct financial interest in a foreign financial account. For example, an individual is required to report the foreign financial account of his or her wholly owned domestic or foreign corporation. If a domestic corporation has a direct or indirect financial interest in the foreign account, it will also be required to report the account, as would any individuals, such as employees, who have signature authority over the financial account. For purposes of Form 8938, if a foreign financial account is reported by a specific individual, the foreign account will not also be reported by a specified domestic entity, and vice versa.
The due date for filing the FBAR with the Treasury Department in Detroit is June 30 for financial accounts for which the filer had a financial interest or signature authority during the previous calendar year. Form 8938 is due with the taxpayer’s annual income tax return and filed with the applicable IRS service center.
Reporting by Foreign Financial Institutions
FATCA will also require foreign financial institutions (FFIs) to report directly to the IRS certain information about financial accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest. The timeline for implementing these new reporting requirements is contained in Notice 2011-53, which requires an FFI to enter into a special agreement with the IRS by June 30, 2013. Under this agreement a “participating” FFI will be required to perform the following:
(1) Undertake certain identification and due-diligence procedures with respect to its account holders;
(2) Report annually to the IRS on its account holders who are U.S. persons or foreign entities with substantial U.S. ownership; and
(3) Withhold and remit to the IRS 30% of any payments of U.S.-source income, as well as gross proceeds from the sale of securities that generate U.S.-source income, made to (a) nonparticipating FFIs, (b) individual account holders failing to provide sufficient information to determine whether or not they are a U.S. person, or (c) foreign entity account holders failing to provide sufficient information about the identity of its substantial U.S. owners.
Although Notice 2011-53 provides the phased-in timeline of key FATCA implementation dates for FFIs, it should be noted that many details of the new reporting and withholding requirements will be revealed in Treasury regulations that are expected to be proposed shortly
5 European Nations Agree to Help U.S.Crack Down on Tax Evasion
Washington won important backing for an effort to identify offshore accounts held by Americans, as key European allies agreed to help. In a joint statement, the United States, France, Germany, Italy, Spain and Britain said they wanted “to intensify their cooperation in combating international tax evasion.” In return, Washington has agreed to “reciprocate in collecting and exchanging” information about U.S. accounts held by residents of those countries.The agreement concerns the Foreign Account Tax Compliance Act, known as Fatca, which became law as part of a 2010 jobs bill. Fatca is meant to help the U.S. Internal RevenueService identify hidden accounts and other assets held overseas by Americans, but the law has caused an outcry among foreign financial institutions that fear the cost of compliance as well as what they have said are unrealistically tight implementation deadlines.There were also concerns that Fatca — which will require that virtually every financial institution in the world report any accounts held by Americans, with a withholding penaltyfor noncompliance — would put banks into a position of violating national secrecy laws to comply.
Jain Jacob is a CPA Practices in New York and serves client all 50 states. He was a Senior Tax Manager for Deloitte & Touché. He is also member of the Personal Financial Planning Committee and State and Local Taxation Committee of New York State Society of CPA’s