Tax Attorney or Tax Accountant

Hi,

I'm having to file back taxes due to being wrongly informed by a UK based US tax "expert" some years ago (about 15!) when I first moved to the UK. I've begun the painstaking process of digging out my documentation and am now trying to choose the right firm to help me file.

I'm fairly certain that my situation is pretty uncomplicated and I won't be owing a lot of taxes, but I'm wondering if using a Tax Attorney would be any more benefit than going through a Tax Accountant? Obviously, the Attorney would be much more expensive but I'm also concerned about the amount of time that's passed where I've not furnished a return.

Would be great to hear anyone's thoughts on this....

Thank you!

It's difficult to respond without knowing anything about the nature of your issue.

If you could explain what you were wrongly informed about, and therefore now need to correct, people will be more able to point you in the right direction.

Wrongly informed about filing - I was told I would not need to file as long as my salary was below a certain threshold, which it always was. So I'm now going back to start the process of rectifying this and filing past returns, but I'm wondering if it would be more prudent (given the number of years) to use a Tax Attorney or just if a Tax Accountant is sufficient.   

Wrongly informed about filing - I was told I would not need to file as long as my salary was below a certain threshold, which it always was. So I'm now going back to start the process of rectifying this and filing past returns, but I'm wondering if it would be more prudent (given the number of years) to use a Tax Attorney or just if a Tax Accountant is sufficient.

Sounds like there was some confusion between not having to pay US tax and actually still having to file to claim the FEIE.

I would start with a couple of the professional contributors to this forum who are experienced in delinquent filing.

http://britishamericantax.com/
http://www.americantaxreturns.co.uk/

What would be the possible repercussions if a person didn't file?  For 15 years or so, just for the sake of argument?


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What would be the possible repercussions if a person didn't file?  For 15 years or so, just for the sake of argument?


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There's no fine for not filing your taxes, but there will be interest to pay on any delinquent tax that you owe....and there are the fines for not filing FBAR.

Thanks for your reply.  What's FBAR?


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The so-called FBAR has been renamed as Financial Crimes Enforcement Network (FINCEN) form 114. In any given year, compute the maximum amount in USD for each of your non-US accounts. Add up the maximums. If the total exceeds $10,000, you have to file FINCEN114. If you fail to file, there are grossly punitive fines. Failure to file these forms is, in principle, worse than not filing US taxes. But don't panic - you can backfile these with adequate excuse - seems like ignorance would work for you (no offence intended  )

Ha!  No offence taken, especially since you are giving me valuable advice.

I have a few bank accounts here in my name, but the total is nowhere near $100,000.  Does that mean I can completely ignore this? 

A also have a limited company with a bank account but I am assuming that does not count since the money belongs to the company.  I am the only share holder though.


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I have a few bank accounts here in my name, but the total is nowhere near $100,000.  Does that mean I can completely ignore this?

You're a decimal place off of the requirement - like Weller said it's $10,000 and not $100,000 (so odds are much greater that you do have to file the form).

 :)You also own a CFC - bet you had no idea how much fun it is being American overseas. Did your company accountant advise you of the US tax implications?

Darn, missed that decimal because I'm on my phone.  I still might be Ok depending on what counts and what doesn't in terms of ISAs and pensions. 

 I'm not liking this conversation at all.  Looks like I'm going to have to find an accountant that's a bit more knowledgeable about what I need to do.  Granted, my current guys  don't advertise themselves as US specialists, but at least they could have had some idea. 

Anyway, what's a CFC and how do I own one?  The limited company I refer to is completely UK and never bills outside of the U.K.  I always thought the Americans had nothing to do with it and were only concerned with income from it in salary and dividends.


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Darn, missed that decimal because I'm on my phone.  I still might be Ok depending on what counts and what doesn't in terms of ISAs and pensions. 

 I'm not liking this conversation at all.  Looks like I'm going to have to find an accountant that's a bit more knowledgeable about what I need to do.  Granted, my current guys  don't advertise themselves as US specialists, but at least they could have had some idea. 

Anyway, what's a CFC and how do I own one?  The limited company I refer to is completely UK and never bills outside of the U.K.  I always thought the Americans had nothing to do with it and were only concerned with income from it in salary and dividends.


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You need a US qualified tax person to do US taxes if you don't take that responsibility yourself. Also you must take on board that the IRS taxes US citizens on their worldwide income wherever they live. A CFC is a Controlled Foreign Corporation

ISAs and pensions have the potential for complications because you need to know their structure to know if they fall under FBAR and how they should be taxed. If you describe your ISAs (cash or stocks and shares) and pensions (SIPP or final salary etc) we can have a stab at offering some advice.......but if you have any uncertainty you should go to a US and UK qualified tax person; the two people I recommended earlier will definitely be able to help you.