Wednesday, October 1, 2014
Wednesday, October 1, 2014
Miami-based law firm Cantor & Webb PA is helping dual citizens in The Bahamas navigate complex US tax regulations with the creation of a new company dedicated to assisting taxpayers with compliance.
CW Tax Services Corp, which launched yesterday, is a boutique tax preparation and consulting company. Headed by Cantor & Webb PA partner Arthur Dichter, the firm’s eight staff will work closely with its parent company to give clients a full service offering.
“There are eight million Americans living outside the US [and] it is likely that a fair number are in The Bahamas. We want to assist them in getting compliant, and staying compliant,” said Dichter.
“Our clients appreciate the fact that there is a relationship between our law firm and our tax compliance preparation,” added Cantor & Webb PA managing partner Steven Cantor. “We want to be of service to people in The Bahamas who have tax compliance needs and may have thought that if they have more than one passport they are immune [to the regulations].”
“An American living in The Bahamas needs to know that they have brought with them all the filing and reporting obligations they would have if they were living in the US.”
In June 2014, the US Internal Revenue Service (IRS) announced significant changes to its offshore voluntary compliance programmes—expanding the scope of the regulations and reducing penalties to encourage more US taxpayers to come forward.
The regulatory changes were published in advance of the Foreign Account Tax Compliance Act which comes into force in January 2015 and will require US taxpayers and certain Foreign Financial Institutions to disclose any assets held outside the US to the IRS.
Dichter and Cantor, who presented at the Society of Trust and Estate Practitioners’ luncheon held yesterday at the British Colonial Hilton in Nassau, say the trend towards greater transparency in tax reporting has led to a raft of complex legislation and advise US taxpayers to ensure they are in line with the law before it is too late.
“The world has changed and we are now in a transition phase,” said Cantor. “It is now a world of tax transparency. For those people who think they can stick their heads in the sand, there is no sand left.”
“In five years, tax transparency will be standard practice everywhere. If anyone has not come into compliance in that time they will probably have lost any goodwill or opportunity to resolve their issues.”
In achieving compliancy, Dichter cautioned US citizens to seek professional advice saying: “It is not something I would advise people to manage on a do-it-yourself basis.”
Cantor agreed: “It is nuanced. Unless you are dealing with a professional who has experience you are apt to cost yourself more than you are going to gain.”