USA Do NOT hide that Income- It is very dangerous - Canadian-US-Global Income tax help - david ingram expert US CANADA cross bor
News release
The CRA takes action to enforce tax laws
Ottawa, Ontario, May 20, 2010... The Canada Revenue Agency (CRA) uses a variety of tools and methods to identify non-compliance and take action to address tax cheating, as well as to correct honest mistakes.
The CRA is committed to promoting the integrity of the tax system through a wide range of compliance activities. In 2008-2009, the CRA:
- obtained more than 787,000 tax returns from individuals and corporations who had failed to file, which resulted in a fiscal impact of more than $2.3 billion;
- Conducted close to 374,000 audit and review actions, including 12,800 underground economy audits, and close to 1,200 audits of taxpayers suspected of earning income from illegal activities;
- Detected almost $1.4 billion of unreported income for small- and medium?sized businesses;
- Audit programs detected a fiscal impact of $5.2 billion identified through international and large business audits, and $2.2 billion resulting from audits and examinations of small- and medium-sized businesses (includes the fiscal impact of the $1.4 billion of unreported income noted above);
- Reviewed the books and records of 4,371 businesses to ensure they were properly maintained;
- Identified over 17,000 participants claiming donations of $484 million in tax shelter arrangements;
- started legal actions that resulted in the conviction of over 1,100 taxpayers who failed to file their income tax returns;
- resolved over 17 billion dollars of debt through various collection activities at Tax Services Offices.
In 2008-2009, CRA referrals of criminal investigations to the Public Prosecution Service of Canada resulted in:
- Courts across Canada imposing fines of close to $29.2 million and offenders sentenced to more than 81 years in prison.
- Convictions in 323 cases for tax evasion or fraud and convictions obtained in 98% of cases prosecuted.
The CRA reminds all taxpayers when they file their returns, to be sure to report their income, deductions, and credits accurately.
More information on the compliance activities the CRA undertook in the past year can be found in the Canada Revenue Agency Annual Report to Parliament 2008 - 2009 at www.cra.gc.ca/annualreport.
The CRA's Web site contains information on programs such as the Voluntary Disclosures Program (www.cra.gc.ca/voluntarydisclosures). This program allows taxpayers to come forward and correct their tax affairs without penalty and prosecution.
This document is also available for download in PDF format.
To get notification by email when news releases, fact sheets, tax tips, and tax alerts are added to our Web site, subscribe to our electronic mailing list. You can also subscribe to the Media room RSS feed.
--------------------------
The following from the IRS site will give you a bit of an idea. Notice the jail sentences. Jerome Schneider of Vancouver got 6 months and a $100,000 fine for his dealings which had nothing to do with UBS.
-------------------------------------------------------------------
The IRS continues to uncover abusive tax-avoidance schemes involving offshore activity. Find information here pertaining to Union Bank of Switzerland (UBS).
Aug. 19, 2009 Announcement and Documents
IRS to Receive Unprecedented Amount of Information in UBS Agreement (News Release 2009-75)
Excerpts from IRS Commissioner Doug Shulman's Press Remarks
U.S.-Swiss Government Agreement | Declarations | Bank Agreement
UBS Clients
Feb. 4, 2010 — Jack Barouh of Golden Beach, Fla., pleaded guilty to filing a false tax return. Barouh admitted to filing a false tax return for 2007 in which he failed to report a foreign bank account.
Oct. 5, 2009 — Roberto Cittadini of Bellevue, Wash., pleaded guilty to filing a false tax return and admitted to concealing nearly $2 million in Swiss bank accounts. Cittadini, a retired sales manager for Boeing, failed to file a Report Foreign Bank and Financial Accounts for 2001 through 2003. Cittadini was sentenced on Jan. 8, 2010, to six months home detention and one year supervised release and was ordered to pay a $10,000 fee and $17,985 in restitution.
Sept. 25, 2009 — Juergen Homann of Saddle River, N. J., pleaded guilty to failure to file a Report of Foreign Bank or Financial Accounts and accepted responsibility for concealing more than $5 million in Swiss bank accounts. Homann was sentenced on Jan. 6, 2010, to five years probation and was ordered to pay a $60,000 fine.
Aug. 14, 2009 — John McCarthy of Malibu, Calif., pleaded guilty to failing to inform the government of a Swiss bank account as part of a scheme to move at least $1 million from the United States into Swiss bank accounts with the goal of avoiding the payment of federal income taxes.
July 28, 2009 — Jeffrey P. Chernick of Stanfordville, N.Y., pleaded guilty to charges of filing a false tax return. Chernick, who owns a corporation which represents toy manufacturers in China and Hong Kong, accepted responsibility for concealing more than $8 million in Swiss bank accounts. Chernick was sentenced on Oct. 30, 2009, to three months in prison and one year of supervised release with six months served in home detention.
June 25, 2009 — UBS client Steven Michael Rubinstein of Boca Raton, Fla., pleaded guilty to filing a false tax return for tax year 2004. On April 1, 2009, Rubinstein was charged with filing a false tax return that intentionally failed to disclose the existence of a Swiss bank account maintained by UBS of which he was the beneficial owner and failed to report any income earned on that account. Rubinstein was sentenced on Oct. 28, 2009, to three years probation, of which 12 months will be served in home detention.
April 14, 2009 — Robert Moran of Lighthouse Point, Fla., pleaded guilty to a criminal information charging him with filing a false income tax return. Moran accepted responsibility for concealing more than $3 million in assets in a secret bank account at UBS in Switzerland. Moran was sentenced on Nov. 6, 2009, to two months in prison and one year of supervised release with five months in home confinement.
Legal Actions to Date
Aug. 21, 2009 — Former UBS banker Bradley Birkenfeld was sentenced to 40 months in prison. Birkenfeld worked as a private banker for UBS AG and assisted an American billionaire real estate developer evade paying $7.2 million in taxes.
Aug. 20, 2009 — Hansruedi Schumacher and Matthias Rickenbach were indicted for conspiring to assist wealthy American clients conceal their assets by establishing sham offshore entities. Schumacher was an executive manager at Neue Zuercher Bank (NZB), a private Swiss bank. Rickenbach was a Swiss attorney who advised U.S. clients.
Aug. 19, 2009 — The Justice Department and the IRS today announced that an agreement has been reached with the Swiss government regarding the John Doe summons filed against UBS on June 30, 2008.
Feb. 18, 2009 — UBS AG, Switzerland’s largest bank, entered into a deferred prosecution agreement on charges of conspiring to defraud the United States by impeding the Internal Revenue Service (IRS).
Nov. 12, 2008 — Raoul Weil, a senior executive of a large Swiss bank, was charged with conspiring with other executives, managers, private bankers and clients of the banking firm to defraud the United States.
June 30, 2008 — The Justice Department filed papers seeking an order from a federal court in Miami, Fla., authorizing the Internal Revenue Service (IRS) to use a John Doe summons to request information from Zurich, Switzerland-based UBS AG about U.S. taxpayers who may be using Swiss bank accounts to evade federal income taxes.
May 13, 2008 — Banker Mario Staggl was indicted for conspiring with banker Bradley Birkenfeld to assist an American billionaire real estate developer evade paying $7.2 million in taxes by assisting in concealing $200 million of assets in Switzerland and Liechtenstein.
Dec. 12, 2007 — Igor Olenicoff, president and owner of Olen Properties Corporation, pleaded guilty to filing a false tax return for tax year 2002 related to foreign bank accounts he failed to disclose to the IRS. According to Olenicoff’s plea agreement, during the years 1992 through 2004, Olenicoff owned, controlled and had signatory authority over financial accounts outside of the United States.
Hi David:
I am in need of an accountant. I have interviewed several accountants thus far and haven't been impressed with the customer service. I
am looking for someone who will work with me to understand my tax situation and let me know if they have the expertise to organize
my taxes.
I am a Sales Associate for a Direct Selling company (Multi-Level-Marketing) in XXXXXXXXX, XXXXXX.
I have a home based business (not a hobby). This is my main stream of income. I am responsible for marketing and distributing their
health, nutrition, and personal care products. They have been approved to do business in x countries including Canada. I reside in Columbus, Ohio.
I have gotten paid by the xxx branch since March of 2004. I made $xx,xxx USD in 2007. So on xxx 28, 2007, I decided to incorporate
in Vancouver, Canada.
Why Vancouver you ask? because my company's office in Canada will pay me 1.43 CAD. As you know the CAD and the USD are basically
a 1 to 1 ratio. This will boost my income about 43%.
So my current situation is that I incorporated in Vancouver, Canada on xxx 28, 2007 and my first CAD check was deposited in my TD Canada Trust
account on xxxxxxx, I live in Columbus, Ohio. This will be my main residence. I will travel around the world but will stay in Ohio. I anticipate
making about $xx,xxx CAD in 2008. I deduct all my business expenses such as a percentage of rent, some meals, miles, airfare, hotels, tools, etc.
So here comes my question, can you help me and where do I go from here?
Sincerely,
---------------------------------------------
You are obviously an interesting person. I just followed your adventures through Malaysia, KL, Singapore and Australia.
I also spent a summer in Columbus back in 1958 (before you were born) and got to be shown around a B-47 Bomber at Lockbourne (now Rickenbacker since 1974) Air Force Base. I also saw a F-86 Sabre Jet that was visiting the base at the time. Real thrills for a Canadian kid from Winnipeg, Manitoba.
I am afraid that you have complicated your life by putting your situation outside of the comfort zone of 997 3/4's out of 1000 accountants. That means that you will have to interview 400 or so more accountants before you come up with one or you can follow my suggestions below.
I have no interest in your business although I could do it. Why no interest? I can look after another 20 or 30 clients at an average of $1,200 in the time that it takes me to deal with your cross border corporate details. I am not set up with corporate preparation people. And, you will not want to pay me the $15,000+ a year that the cross border accounting and advice a year will / would be worth whether you do $10,000 worth of business or $100,000. I am NOT a good hand holder. I do not follow up worth a damm. I hardly ever return phone calls. BUT, I accept phone calls from 10 AM to 9 PM seven days a week so if you phone at 1 and I have not called back by 6 PM, you can call me back up to 9 PM. Even in July, you are welcome to call me at 5 PM on a Sunday. I would rather that every one phones when they think about something than 15 people try calling at 10 AM on Monday. I also take calls when clients are with me. Rude? Maybe, but it means that that person also gets the ability to interrupt me with someone else and what goes around comes around. I think every client I have met in person has been interrupted
during their 'private' consultation. And I bet that 16 out of 20 of them have had the courtesy of being able to interrupt me with someone else when they have that burning question that came up while they are sitting in their bank manager's office or being questioned at the border. It works for me and my clients although it is unusual.
Now, 'Anyone' good enough in a major accounting office to deal with your stated objectives is going to be looking at $400 to $500 an hour for the advice you are looking for. The US and Canadian Tax returns should be a minimum of $5,000 with $10,000 not out of sight by the time you fill in your US 5471 forms and prepare your Canadian Corporate T2 return.
HINT one.
You should only use a December 31 year end for the Canadian company because the US 5471 forms will be much cheaper if you are set up as a Dec 31st year end. By the way, failure to file the 5471 forms is a minimum penalty of $10,000 for the first 90 days and $10,000 every 30 days thereafter to a maximum of $50,000 a year per shareholder of the Canadian company.
In addition the Canadian Company will also likely end up with more than $10,000 in its account at some time and that necessitates the filing of form TDF 90-22.1 which has a minimum fine of $10,000 to a maximum fine of $500,000 plus up to 5 years in jail for failure to file.
Hint two.
When you are trying to find an accountant on either side of the border, start off by asking them what the rules are for when a 5471 and a TDF 90-22.1 have to be filed. If they can not answer immediately, then you do not want to be their guinea pig. Now, it will be likely that the person who answers the phone does not know so do not ask them so that they can write it down, say no one is available and then have someone else phone you back after getting a chance to look up the answers.
Save the questions for the actual tax person.
Hint three.
I would forget about the corporation unless you know it is going to make you a fortune. It 'reallllly' complicates your life! there is no way that being the president of a non-resident CANADIAN corporation is worth the hassles unless it is making you $100,000 a year or more in my opinion.
But you still have the corporation.
Some hints to get them done. Who could look after you?
Gary Gauvin is absolutely qualified to deal with you. He is an old business partner of mine from Ottawa. He now practices outside of Dallas Texas as a one or 1 1/2 person office. If you deal with Gary, you will deal with Gary. He is a US enrolled agent. You can find his website easily. Type - income Tax Expert - into
google. Gary will come up as number one or two. Why, because he is. If I am looking for a first or second opinion, I call Gary. Disadvantage -
Gary is a one person office. Advantage - You will always get to talk to Gary.
Gary likes corporations. I and my three associates do not like them. I like dealing with individuals who deal cross-border withOUT corporations.
OR KPMG in Vancouver. The last time I checked they had 22 people in their US/Canada department. call (604) 691-3025. Advantage - Lots of Backup. Disadvantage - It will be hard to get the same person to deal with you three times in a row.
OR Steve Peters with KPMG in Halifax (902) 492-6011
OR Kevin Nightingale in Toronto (416) 733-9595
OR Len Vandenberg with BDO Dunwoody in Kelowna, BC. (250) 763-7600
Whoever you choose, you would likely do well to consult with me for one or two hours a year. If I have a suggestion, it will be worth it. If I can't come up with anything, you will know that what you are doing is likely the best track. I will compare it to my dentist. When I went inthe fall of 2005, I ended up with $16,000 to $18,000 of dental bills, a bunch of pain, and a lot of nice new caps, etc.
When I went for an inspection on Jan 29th, he could not find anything wrong exceopt that I was not flossing. Which one did i appreciate more?
Well both - the first time was expensive buit dealt with years of neglect. The second said I am on the right track.
Good luck.
----------------------------------------------------------------------------------------------------------
Please also note that we prepare Canadian, US, Australian, UK and New Zealand returns on a mail in, email, fax, snail mail or couriered basis. At any time, our clients are in 40 countries or more. They have every occupation from nuclear Submarine captains to FedEx pilots to Major Bank officers to Politicians, Diplomats and border patrol officers. My favourite, however, is a penguin catcher in Antarctica among others there..
If you 'really' only have a single question requiring a 'couple' of minutes, you can try phoning me for free as part of the following.
- For a quick free question
You might try calling Fred Snyder's radio program for an answer on a Sunday Morning..
Fred Snyder's "IT'S YOUR MONEY" radio show. on CISL, 650 AM on the dial in Vancouver from 9 to 11:00 AM every Sunday (604) 280-0650 or (877) 280-0650 - You can listen live from anywhere in the world at www.am650radio.com from anywhere in the world. click on the button in the top left hand corner.-
- You might try calling Fred Snyder's weekly radio programs for an answer.
-
Circular 230 Disclosure: Pursuant to recently-enacted US Treasury Dept. regulations, we are now required to advise you that, unless otherwise expressly indicated, any federal tax advice contained in this communication, including attachments and enclosures, is not intended or written to be used, and may not be used, for the purpose of (i) avoiding tax-related penalties under the internal revenue code or (ii) promoting, marketing, or recommending to another party any tax-related matters addressed herein.
-
Privileged and Confidentiality Notice: This electronic transmission (and/or the documents accompanying it) may contain confidential information belonging to the sender. The information is intended only for the use of the individual or entity to which it is addressed. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution, electronic storing, or the taking of any action in reliance on the contents of this information is strictly prohibited. If you have received this transmission in error, please immediately notify the sender by reply e-mail and immediately delete this record from your computer system.
-
US / Canada / Mexico tax, Immigration and working Visa Specialists
US / Canada Real Estate Specialists
My Home office is at:
North Vancouver, BC, CANADA, V7N 3L7
Cell (604) 657-8451 -
(604) 980-0321 Fax (604) 980-0325
Calls welcomed from 10 AM to 9 PM 7 days a week Vancouver (LA) time - (please do not fax or phone outside of those hours as this is a home office) expert US Canada Canadian American Mexican Income Tax service help.
What's Related