Having a Great Idea and Potential Product are Not Enough
There's a chasm between the brilliance of defining a new product and finding its market fit -- and developing the financial foundation to scale the business. What makes someone a great entrepreneur frequently makes him or her pretty bad at steering the financial side of their business. So, what distinguishes someone from the pack is the ability to make both happen.
On August 31, 2012, the IRS issued additional information regarding the streamlined federal income tax return and foreign bank account reporting requirements available to certain delinquent taxpayers which was first announced on June 26, 2012 (the Streamlined Program or Program). The Streamlined Program was created in response to the fact that many individuals had recently become aware (primarily due to increased media coverage) of their ongoing US tax filing obligations and wanted to become compliant. The Streamlined Program came into effect on September 1, 2012.
The Streamlined Program is only available to US taxpayers who have lived abroad since January 1, 2009 and who have not filed US federal income tax returns since that date. In addition, individuals are only permitted to participate in the Program if they are determined to present a “low compliance risk.. Individuals who would be eligible to participate in the Streamlined Program include dual citizens and US “green card” holders who have lived abroad since January 1, 2009.
Participants in the Streamlined Program are required to submit the following documents in connection with their participation in the Program:
In addition, participants are required to pay all federal income tax due and owing and statutory interest, if applicable, with the delinquent returns.
The IRS will determine the level of compliance risk presented by the submission of the above noted returns and the Questionnaire. Absent the existence of any “high risk” factors, if the returns and Questionnaire show less than $1,500 of tax due for all of the three years covered by the Program, they will be treated as “low risk” and processed in a streamlined manner. A determination by the IRS that a submission presents higher compliance risk will prohibit the taxpayer from participating in the Program and may subject the taxpayer to more thorough review.
The primary benefits associated with participation in the Streamlined Program are that the returns submitted will be subject to less intensive review and the taxpayer will not be subject to penalties or follow-up action. It should be noted, however, that participation in the Program does not provide protection from criminal prosecution if the IRS and Department of Justice determine that the particular facts and circumstances warrant criminal prosecution.