There are some administrators still promoting 419 plans. It defies logic to me that sales people will sell something they know or should know will not hold up under IRS scrutiny just so they can sell cash value life insurance. Most of the rest of the 419 sales people are now selling captive insurance and section 79 scams that the IRS is just starting to audit. But badk to the 419 plan.Back in the day (1996–2000), 419 welfare benefit plans used to be all the rage as a way for profitable business owners to reduce their taxes and build a tax-favorable nest egg under the cover of an “employee benefit plan.”
With an ambiguous tax code and some favorable tax court rulings, promoters of WPBs became emboldened and far too high profile in the late 1990s. This was amplified by the life insurance industry's internal marketing of WBPs because they were funded mainly with cash value life insurance.
Without fully explaining how these plans worked, I will simply state that an employer could try to take deductions of $25,000–$300,000+ where all of the money would go into a WBP and into a CVL insurance policy where it could grow tax free for years.
Depending on how aggressive the third-party administrator of these plans were, clients were told the money would either come out and be taxable when in retirement while some administrators even touted that business owners could get the money out tax free (which in my opinion was total nonsense, but that’s how they were sold).
The IRS steps in
Because of the aggressive marketing of these plans, the IRS put it on the top of its hit list. 419A(f)5 and A(f)6 plans, 419(e)3 plans as well as VEBA plans (which are also WPBs) all got hammered by the IRS in 2007 when it issued three revenue rulings. WBPs were also put on the tax transaction list.
U.S. Attorney goes after 419 plan promoter
One 419 plan promoter who has been around since the 1990s just had a complaint filed against him, his spouse and several related companies. It’s a 43-page complaint with request for a permanent injunction barring him and s
FBAR/OVDI LANCE WALLACH
FBAR Foreign Bank Account Reporting The IRS is assessing huge penalties for undisclosed foreign bank accounts, assets & income. Click for more info FBAR FILING DEADLING HAS BEEN EXTENDED
Tuesday, August 20, 2013
FBAR & INT'L Tax Report!
Need Help With Your Foreign Bank Account?
Click Link Below Free FBAR & INT'L Tax Alert report
http://lawyer4audits.com/fbar-ovdi-international.html
Posted by Lance Wallach at 12:57 PM
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Labels: FBAR, international tax, Lance Wallach, Opt-Out, OVDI
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lance wallachMarch 12, 2014 at 3:25 PM
FBAR/OVDI LANCE WALLACH
FBAR Foreign Bank Account Reporting The IRS is assessing huge penalties for undisclosed foreign bank accounts, assets & income. Click for more info FBAR FILING DEADLING HAS BEEN EXTENDED
Tuesday, December 24, 2013
FBAR Offshore Bank Accounts and Foreign Income Attacked by IRS
FBAR Offshore Bank Accounts and Foreign Income Attacked by IRS
Posted by Lance Wallach at 9:19 AM 1 comment:
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Contact Information
Email :
Lanwalla@aol.com
Phone :
516-983-5007
Address :
Lance Wallach
www.TaxAudit419.com
www.Vebaplan.org
IRS Form 8938
FATCA requires any U.S. person holding foreign financial assets with an aggregate value exceeding $50,000 to report certain information about those assets on a new form (Form 8938) that must be attached to the taxpayer’s annual tax return. Reporting applies for assets held in taxable years beginning on or after January 1, 2011. Failure to report foreign financial assets on Form 8938 will result in a penalty of $10,000 (and a penalty up to $50,000 for continued failure after IRS notification). Further, underpayments of tax attributable to non-disclosed foreign financial assets will be subject to an additional substantial understatement penalty of 40 percent.
Under FATCA, U.S. taxpayers holding financial assets outside the United States must report those assets to the IRS on a new form attached to their tax return. Penalties apply for failure to comply with this new reporting requirement. Reporting is required for assets held in taxable years beginning on or after January 1
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Lance Wallach
More Credentials:
National Society of Accountants
Speaker of the Year and member of
the
AICPA faculty of teaching
professionals
Frequent speaker on retirement
plans, financial and estate planning,
and abusive tax shelters.
Writes about 412(i), 419, and
captive insurance plans.
Speaks at more than ten
conventions annually
Writes for mo