For the last several years, LB&I has maintained compliance campaigns to address and improve various areas of tax compliance.  On April 16, 2019, LB&I announced the addition of three new compliance campaigns, two of which involve reporting issues: the Offshore Private Banking Campaign and the Loose Filed Forms 5471 Campaign.

Offshore Private Banking Campaign

The Offshore Private Banking Campaign is under the Withholding & International Individual Compliance practice area.  The purpose of the campaign is to improve federal income tax and information reporting compliance associated with offshore activities, which includes issues such as FBAR compliance and Form 8938 (Statement of Specified Foreign Financial Assets) compliance.  The campaign description states that the IRS has amassed records that identify taxpayers with transactions or accounts at offshore private banks, which likely has been compiled from sources such as reporting under Chapter 4.  The IRS plans to initially address noncompliance through examinations and correspondence.  Additional compliance techniques may be developed based on feedback received throughout the campaign.

The Loose Filed Forms 5471 Campaign

The Loose Filed Forms 5471 Campaign is also under the Withholding & International Individual Compliance practice area.  The purpose of the campaign is to ensure that U.S. persons file Forms 5471 in the correct manner.  In general, Forms 5471 (Information Return of U.S. Persons With Respect to Certain Foreign Corporations) must be filed by U.S. persons if they satisfy the criteria of any one of five categories of filers.  The IRS has identified that some taxpayers incorrectly file Forms 5471 by sending the form to the IRS without attaching it to their federal income tax return.  The taxpayers that have filed a loose Form 5471 should file an amended federal income tax return with their Form 5471 attached.

Tags: FBAR, Form 5471, Form 8938
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Photo of Michael M. Lloyd Michael M. Lloyd

Michael Lloyd practices in the areas of tax and employee benefits with a focus on information reporting and withholding on cross-border payments (e.g., Forms 1042 and 1042-S) and Foreign Account Tax Compliance Act (FATCA), backup withholding, employment taxation, the treatment of fringe benefits…

Michael Lloyd practices in the areas of tax and employee benefits with a focus on information reporting and withholding on cross-border payments (e.g., Forms 1042 and 1042-S) and Foreign Account Tax Compliance Act (FATCA), backup withholding, employment taxation, the treatment of fringe benefits, cross-border compensation, domestic information reporting (e.g., Forms W-2, 1099, 1095 series returns), penalty abatement, and general tax planning and controversy matters. Michael advises large U.S. and foreign multinationals regarding compliance with information reporting and withholding issues, as well as a range of other federal and state tax issues.

Michael completed a three-year term on the IRS Information Reporting Program Advisory Committee (IRPAC) in 2013, during which time he worked with the IRS on FATCA, the Affordable Care Act (ACA or Obamacare) reporting issues, tip reporting, Form 1099-K reporting issues, and civil penalty administration. He has testified before the U.S. Treasury Department and the IRS regarding proposed federal tax regulations.

Michael’s experience includes serving as Tax Manager for a publicly traded multinational, where he managed federal and state tax examinations and appeals, including matters involving foreign taxes. In addition, he performed domestic and international tax planning, including issues related to the repatriation of foreign earnings, U.S. export tax benefits, research credits, and planning for foreign expansion.

Michael has appeared as a guest speaker on IRS Live and at seminars hosted by Tax Executives Institute (TEI), Thomson Reuters OneSource, IRSCompliance, the American Payroll Association (APA), the Blue Cross and Blue Shield Association, the National Association of College and University Business Officers (NACUBO), and the National Restaurant Association.

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