Clients with international financial transactions, specifically those with family overseas, need to keep this in mind.
To keep it simple, we could focus on three points:
- Gifts received from a foreign source over $100,000 require disclosure to IRS even if not taxable.
- There is a specific procedure for reporting omitted reports from past years.
- The tax penalty for not complying with this procedure is severe.
Consider this story in Procedurally Taxing for more information.