International Tax Non-Compliance, Exit Taxes, Special Treatment for Accidental Americans, and Urgency Created by Recent Whistleblower Actions



Voluntary compliance is a hallmark of the U.S. tax system; taxpayers are expected to proactively file all returns with the IRS and pay all amounts due. Many taxpayers fail to meet that commitment, of course. This is where whistleblowers come into play. If they can provide data to the IRS that leads to the collection of taxes, penalties, and interest from non-compliant taxpayers, they stand to receive a percentage of the take. This financial reality has incentivized whistleblowers to bring to the IRS’s attention taxpayers falling into various categories, including “accidental Americans.”

This article explains obligations of U.S. persons with foreign activities, describes the exit tax, identifies a special relief program for former U.S. citizens, summarizes the whistleblower process, and examines a recent Tax Court case that brings these concepts together.

Read the full article here.

About Hale E. Sheppard
HALE E. SHEPPARD, Esq. (B.S., M.A., J.D., LL.M., LL.M.T.) is a Shareholder in the Tax Controversy Section of Chamberlain Hrdlicka and Chair of the International Tax Group.

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