The transactions allowed the group founder and chairman Park Hyeon-joo and his family to pocket profits
By taking advantage of the "golden opportunity," Amazon would provide more competition to FedEx and UPS.
The company noted that loungewear and athleisure products were highly in strong demand as people have to stay at home.
IRS Clamps Down on Expatriates: ‘Your Worldwide Income is Subject to U.S. income Tax…’
Millions of Americans live and work abroad. The US expatriate community grows larger every year, thanks in part to the lower costs of living in many countries outside the United States, the immersive appeal of a new culture, affordable health care abroad, and in many cases an improved overall lifestyle. Regardless of where you live in the world, as a US citizen you are duty-bound to report all income, bank accounts, and financial holdings to the IRS and/or the US Treasury Department. It is not optional; it is mandatory. All US expatriates are required to pay US taxes, or at the very least file an annual tax return form.
The US stands alone as the only industrialized country which requires all citizens to file taxes and/or pay taxes on all worldwide income. The IRS takes a harsh position against citizens who do not do so; it is considered a ‘willful criminal act.’ Indeed, Joshua Ashman CPA added that, ‘…Continuing the trend of recent years, the IRS recently listed offshore tax avoidance as one of its “dirty dozen” tax schemes that it will focus on during 2019. This news comes off the heels of the 2018 year, which saw international returns being seven times more likely to be audited than the average tax return.’ According to the IRS, taxpayers who are living abroad include resident aliens (green card holders) and US citizens. Everyone must follow all the rules and regulations of tax reporting on estimated tax payments, estate taxes, gift tax returns, and income tax wherever they are living. The rules of the IRS are strictly enforced for all US citizens and US permanent residents.
The IRS automatically grants expatriates and all Americans abroad an automatic 2-month extension to file taxes. In the US, the annual tax filing date is April 15, but for taxpayers living abroad the date is June 15. If taxes haven't been paid by April 15, they will incur interest charges. The IRS lists clear instructions on how US taxpayers abroad must file their taxes, with all returns being mailed to the Department of the Treasury, IRS Center, in Austin Texas. It is possible to file taxes electronically, particularly with taxpayers who have adjusted gross income within a set threshold. The filing requirements can be complicated, particularly with respect to calculating taxes that are owed, when the host country automatically deducts taxes from your paycheck, investment income, stocks, bonds, equities, cryptocurrency, and other revenue streams. The issue of dual taxation is typically not something that an average US taxpayer can fathom, given the complexity of reporting requirements.
ExpatTaxProfessionals (ETP) are industry-leading experts in this field, and they have been offering their services to US citizens and permanent residents living abroad for many years. The company works with CPAs (certified public accountants) and global tax experts to offer online tax preparation solutions. For Americans living in the United Kingdom, New Zealand, and Australia, there are many complexities to contend with. Filing a US tax return is mandatory. Many US taxpayers find it difficult to complete their own tax returns, and rely heavily on professional tax preparation experts to provide these types of services. According to ETP, ‘…if you are a US citizen or permanent resident living in a foreign country, you need to be aware of your tax reporting requirements. You will be required to file an annual tax return with the IRS, and if you have foreign bank accounts, you will need to file FBAR and Form 8938 too. Failure to do so can result in severe penalties from the IRS.’
Filing the Right Forms with the IRS and the Treasury Department
Form 8938 is used for reporting ‘specified foreign financial assets’ if the total value exceeds the reporting threshold. Form 8938 is a statement of specified foreign financial assets, and it requires the US taxpayer or permanent resident to declare foreign deposits, custodial accounts, other foreign assets, and a summary of tax items attributable to specified foreign financial assets. The account holder is expected to provide detailed information for each foreign deposit and custodial account. Often, US taxpayers find it too complex to complete all of these forms and submit them to the relevant departments on time. The US government has been cracking down on US taxpayers abroad, particularly with foreign bank accounts in countries throughout Europe, Africa, the Middle East, the Caribbean, and Latin America. Now, stringent laws are in effect that require all foreign banking organizations to hand over information of all accounts held by American citizens. The IRS and the Treasury Department carefully scrutinize all of these accounts, and they are ready to crack the whip on anyone who fails to report their foreign account holdings.
FBAR is a report for banking and financial accounts. It is required according to the Bank Secrecy Act and must be filed with the Treasury Department. US taxpayers must report all foreign banking financial accounts on FinCEN Form 114. If the aggregate value of your foreign financial holdings is $10,000 or more in any calendar year, FBAR must be filed. The due date is April 15, but extensions are automatically granted until October 15 if a taxpayer fails to file on time (April 15). FBAR is automatically filed through the Financial Crimes Enforcement Network via the BSA E-Filing System. It is not filed with a regular tax return. Herein lies another complexity that many US taxpayers felt to understand – they include the FBAR with their 1040 tax return. FBAR reporting requirements mandate meticulous record-keeping of accounts, including the name of the account, the account number, the name and address of the foreign bank, the type of account which is held, and the maximum value that the account reached during the financial year. Additionally, US taxpayers living abroad must maintain records of all FBAR -related activity for 5 years. There are civil monetary penalty descriptions for non-willful violation of transactions with a maximum penalty of $12,921. If there is willful violation of transactions, the maximum penalty is 50% of the amount of the holdings abroad, or $129,210. Filing an FBAR late will incur penalties, it is imperative that US taxpayers contact an online tax preparation expert as soon as possible to avoid high penalties.
How many US taxpayers are thinking of relocating abroad?
Statistics indicate that approximately 10,000 Americans retire daily. With increasing life expectancy and rising inflation, many people are considering living abroad in countries like the UK, Australia, Canada, Ecuador, and Costa Rica. Approximately 700,000 retirees currently live abroad, and there are still tax reporting requirements vis-a-vis investment income, Social Security, 401(k)s, and other financial asset reporting requirements. AARP conducted a study in 2010 regarding which places are deemed to be the best for retirement. Several countries emerged as favorites for American retirees, including Nicaragua, Panama, Spain, France, Costa Rica, Belize, Argentina, Portugal, and Italy. As people age, the costs of health care become inordinately expensive, and despite US Medicare providing adequate healthcare in the US, many foreign countries offer universal coverage to foreigners with resident visas too, with a much lower cost of living.
Retirement aside, there are thousands of UK citizens who were born in the US, but left soon thereafter. These people are now facing a potential nightmare situation with their UK bank accounts. The Guardian ran a story about UK citizens born in the US who left when they were a few months old to go back to the UK. Now, years later the US tax authorities are applying pressure on UK banks to provide details of all US account holders. Because many of these Britons didn't receive a written tax identification number many years ago, they run the risk of having their UK bank accounts frozen by the US tax authorities. Given all of these complicated issues, it behooves Americans living abroad to be compliant with the latest IRS and Treasury Department regulations. The European Banking Federation estimates that there are some 300,000+ ‘Accidental Americans’ across the European Union. Many of them live in the United Kingdom, or France. Even the UK Prime Minister Boris Johnson is one such accidental American who subsequently gave up his US citizenship when the US government tried tax him on his Islington home in London.
It is clear that the IRS has tentacles that can reach everywhere and anywhere at any time. ETP advises all US citizens and permanent residents abroad to adopt a proactive policy towards compliance at all times. Non-compliance for any reason can have devastating repercussions.
This article does not necessarily reflect the opinions of the editors or management of EconoTimes.