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Contact:
Christine Bucan
Pantín/Beber Silverstein Public Relations
305-929-9723 or christine@thinkbsg.com
IRS TARGETS FOREIGN CONSULAR EMPLOYEES
--March 30 is deadline to qualify for tax settlement--
MIAMI, Fla., March 7, 2007 -- The IRS has launched targeted audits of U.S. citizen and legal permanent resident employees of foreign embassies, foreign consular offices and international organizations.
The IRS estimates that as many as half of these employees subject to U.S. tax either fail to report their wages, claim deductions they are not entitled to, incorrectly establish SEP/IRA retirement plans, fail to pay self-employment tax or fail to file tax returns at all.
To encourage voluntary cooperation, the IRS is offering a one-time "Settlement Initiative," with reduced penalties for those who come forward by March 30, 2007. There are some 60 consular offices and 20 foreign trade offices in South Florida with employees that may qualify for the settlement initiative.
Miami-based Mallah Furman is the accounting firm for the South Florida Consular Corps. Benjamin Bohlmann, a partner at the firm with extensive international experience, summarized the settlement as follows:
- Employees must file original or amended tax returns for 2003, 2004 and 2005.
- They must pay back taxes and interest for those years.
- Penalties are owed only for one of the three years.
- Participants would avoid audits and penalties that could cover more than the 3 years in question.
- Simplified Employee Pension/Individual Retirement Account plans set up in error can be unwound.
- Participants in the Settlement Initiative must inform the IRS by March 30 and file all required information by April 30.
- For those who don't voluntarily come forward, the IRS may "(a) conduct examinations, (b) determine the correct taxes, penalties, additions to tax; and (c) issue a Notice of Deficiency." This means that more than the 3 years offered by the Settlement Initiative could be investigated by the IRS.
About Mallah Furman:
Established in 1960, Mallah Furman now ranks as the 9th largest accounting firm in South Florida. The Firm provides strategic financial services to South Florida businesses in a broad spectrum of industries. For more information, please visit the Firm's website at www.mallahfurman.com.
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© 2007, Mallah Furman. All Rights Reserved.
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