Frost & Associates, Attorneys at Law
Call Today 202-618-1873

CPAs say tax season could be tough on U.S. ex-pats in Israel

Americans living or holding bank accounts in Israel might want to batten down the hatches for the coming tax season. That's the forecast from a lot of tax accountants who do work for those individuals.

According to the experts, the odds that the tax returns, especially of those people filing for a child tax credit, will be audited by the Internal Revenue Service are greater than ever. One American accountant working in Israel says that he's seen more audits launched in the past two years than in the previous 30. Not surprisingly, he says the pressure created by the IRS audits is generating a lot of anxiety. 

Anyone who finds themselves squared off with the IRS is likely to experience similar tensions. Skilled legal assistance should be sought and enlisted to help get weather such storms.

In the matter of Israel, experts say the Foreign Account Tax Compliance Act, FATCA, is one reason why audits are being stepped up. But attorneys serving the U.S. expatriate community say another problem is that some in the community have engaged in fraudulent activity and that's tainted everyone else.

What reportedly brought U.S. tax filings from Israel into the scope of the IRS in the first place was the alleged misuse of the $1,000-per-child tax credit. Under U.S. law, if certain conditions are met, filers can claim the credit. If those who live outside the U.S. can show that they are entitled, they can also claim the credit.

Apparently, among the many legitimate claims for the credit filed by Americans living in Israel were some that were bogus. They reportedly were submitted by shady tax preparers on behalf of unsuspecting filers. Increased audits followed.

While lawyers and accountants representing clients in Israel say the initial trigger was the alleged child tax credit abuse, they caution that IRS focus on FATCA and Foreign Bank and Financial Accounts Reports could lead to even broader scrutiny going forward.

Source: The Jewish Daily Forward, "Americans in Israel Targeted by IRS for Tax Audits," Nazthan Guttman, March 3, 2014

No Comments

Leave a comment
Comment Information
Every Tax Problem Has A Solution

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Contact us today!

Frost & Associates, Attorneys at Law
1629 K Street NW
Suite 300
Washington, D.C. 20006

Phone: 202-618-1873
Phone: 202-618-1873
Fax: 888-235-8405
Washington Law Office Map

Columbia Office
10440 Little Patuxent Parkway
Suite 300
Columbia, MD 21044

Phone: 202-618-1873
Phone: 202-618-1873
Fax: 888-235-8405
Columbia Law Office Map

Annapolis Office
888 Bestgate Road
Suite 400
Annapolis, MD 21401

Phone: 202-618-1873
Phone: 202-618-1873
Fax: 888-235-8405
Map & Directions

Fairfax Office
8280 Willow Oaks Corporate Drive
Suite 600
Fairfax, VA 22031

Phone: 202-618-1873
Phone: 703-621-7169
Fax: 888-235-8405
Map & Directions

Rockville Office
199 E. Montgomery Avenue
Suite 100
Rockville, MD 20850

Phone: 202-618-1873
Phone: 240-599-5009
Fax: 888-235-8405
Map & Directions

Google+
Find us on...
  • Facebook
  • Twitter
  • Linked In