Navigating the IRS Penalty Abatement Procedures for Foreign Information Reporting Noncompliance

Requesting Penalty Abatements for Failure to File Forms 5471, 5472, FATCA and FBAR

Recording of a 90-minute CLE/CPE webinar with Q&A


Conducted on Tuesday, September 12, 2017

Recorded event now available

or call 1-800-926-7926
Program Materials

This CLE/CPE webinar will provide tax counsel with a detailed discussion of best practices for requesting abatements of IRS penalties due to failure to properly file required international information forms such as the FBAR, Form 8938, and Forms 5471 and 5472. The panel will discuss the current trends in IRS abatement and will provide guidance on drafting abatement requests.

Description

Tax reporting of international accounts and activities are complex, and failure to file foreign tax informational forms triggers more severe penalties than failure to file most domestic tax informational forms. The IRS has ramped up its attention and resources to international and transnational tax compliance reporting.

The Internal Revenue Code sets penalties for failure to file Forms 5471 and 5472 at $10,000 per unfiled return. Also, Code Section 6038(c) provides for a reduction of 10% or more of foreign taxes available for credit under Sections 901, 902 and 960. Likewise, the penalties for failure to file the FBAR (FinCEN Form 114) range from $10,000 for non-willful failure to the greater of $100,000 or 50% of the account balance at the time of the violation for willful noncompliance.

The IRS employs strict standards for determining whether a taxpayer qualifies for an abatement of penalties for failure to file required foreign tax returns. After the Treasury Inspector General for Tax Administration (TIGTA) issued a report indicating that IRS controls over penalties were deficient, leading to incorrect abatements, the IRS increased scrutiny over foreign penalty abatement requests.

With the IRS continually increasing penalty assessments and decreasing the number of abatements, tax counsel must be fully knowledgeable of the requirements and processes for requesting abatements of penalties.

Listen as our experienced panel provides best practices for documenting and filing requests for abatement of foreign tax penalties.

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Outline

  1. OVDP and penalty avoidance programs
  2. What happens when penalty avoidance fails?
  3. Penalty structures
  4. Reasonable cause abatement standards
  5. Best practices in drafting penalty abatement requests
  6. IRS penalty abatement request process

Benefits

The panel will review these and other key issues:

  • What foreign reporting forms are subject to foreign tax reporting penalties?
  • What are the penalty structures for non-willful and willful failure to file?
  • What are the standards for “reasonable cause” abatement?
  • What is the IRS penalty abatement decision tree model and how does it apply to requests to abate foreign tax penalties?
  • What standards are used by the courts, and the IRS to determine willfulness?
  • How can the IRS Streamlined Procedures be used to mitigate various penalties?

Faculty

Brager, Dennis N.
Dennis N. Brager, Esq.

Brager Tax Law Group

Mr. Brager is a nationally known tax litigation attorney, representing clients in criminal and civil tax litigation and...  |  Read More

Crouch, Joel
Joel N. Crouch

Managing Partner
Meadows Collier Reed Cousins Crouch & Ungerman

Mr. Crouch specializ​es in civil and criminal tax controversies ​involv​ing sophisticated and...  |  Read More

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