>A Chinese couple immigrated to the United States only two years ago, they encountered a thorough investigation by the IRS, and they almost lost their green cards

A Chinese couple immigrated to the United States, they just two years ago, they encountered a thorough investigation by the IRS, and they almost lost their green cards. It only took two years after they immigrated to the United States, they encountered a thorough investigation by the IRS, and they almost lost their green cards. China Overseas Chinese Network March 2...

Just two years after immigrating to the United States, he encountered a thorough investigation by the IRS and nearly lost his green card

China Overseas Chinese Network, March 22 According to the US "World Journal" report, unlike the old immigrants decades ago who dared to pursue the "American Dream" with $200, today's new immigrants are becoming more and more economically powerful, and most of them are highly educated talents or business owners. As we all know, the United States imposes serious taxes. In order to avoid paying taxes in vain on their hard-earned money, they made tax planning before immigrating. However, little did they know that the so-called strategies guided by "experts" have caused them to encounter thorough investigations by the US Internal Revenue Service. If they are found to have violated the law, sometimes they cannot even keep their green cards.

Accountant and tax lawyer Derek Tung shared a representative case. Mr. Liu and Mrs. Liu immigrated to the United States from China in April 2015. Before immigrating, they transferred 100% of the interests in a company to their parents and brothers. The company's revenue exceeds 50 million yuan and its registered capital is 20 million yuan. Mr. Liu works for this company and earns US$40,000 per year. His salary is the highest among all managers in the company and he has the company's signature authority. Their parents and brothers would "gift" the Lius $500,000 every year, and the Lius also declared this expenditure as a gift.

The Lius have a child. Although they do not work in the United States, they often travel between China and the United States. Their bank account deposits in China do not exceed US$10,000. They have several debit cards, each with a deposit of more than US$10,000, with interest income of US$100, and no dividends. They had a house they bought for $1.87 million and had a $500,000 loan, and they were audited by the IRS in 2017.

Tong Zhimin said that the IRS accused them of not declaring the bank account in the company's name, whether tax was required for the $500,000 gift, and of concealing the source of the transaction, transaction ownership, and fund control. The Lius' experience is also a problem faced by many new immigrants. Although they only filed taxes for two years, they were inspected in 2017. "As long as they plead guilty and lose the lawsuit, their green card qualifications will definitely be cancelled."

He said that in cases like this one, where property was held by a third party (Property Held By Third Party), taxpayers often transfer their assets to relatives and friends to avoid having federal tax liens placed on the property, but this generally does not succeed because the federal tax lien will extend to the property held by a third party.

The final conclusion of the IRS in this case was that the 500,000 yuan was not a gift, but the taxpayer's failure to declare the additional income (additional income) of the company they controlled from 2015 to 2016, and a fine of US$10,000 was imposed. According to the law, if you fail to declare overseas assets, the fine can be as high as 50% of your deposit balance, but this was reduced sharply after his fight.

In short, because the Liu couple listened to other people's tax planning advice, it was difficult to determine that they had intended to defraud the IRS in the first place. Therefore, the case was eventually changed from a criminal case to a civil lawsuit, and the parties were able to keep their green cards.

Tong Zhimin said that the Liu couple had been audited by the IRS just two years after they immigrated to the United States. However, the relevant parties will depend on the length of time the parties have immigrated and their handling of affairs, that is, each fact may affect the outcome of the trial. (Wang Quanxiuzi)