Frequently asked questions

Three groups: U.S. citizens and green card holders living abroad, founders and investors with foreign-owned U.S. entities, and e-commerce sellers crossing borders and state lines. If your money moves between countries and the paperwork has started to scare you, that’s my desk.

I’m a CPA and I hold a JD, which means I can do the compliance work and read the statute that created it. Cross-border tax is where accounting rules and legal ones collide, and most of the expensive problems live exactly on that seam.

Yes — English and Spanish, whichever one makes you feel less lost. Cross-border tax is confusing enough without doing it in your second language.

With a scoped fee and a 50% deposit. Once that’s confirmed I send the document request, not before. It keeps the work honest on both sides: you know the cost before you hand over anything, and I know the project is real before I start digging.

Probably less than you fear, as long as you come forward before the IRS comes to you. The U.S. taxes citizens on worldwide income regardless of where they live, so the returns are genuinely late — but the Streamlined Filing Compliance Procedures exist for exactly this situation. Most of my expat clients start here.

It’s the IRS’s catch-up route for taxpayers whose failure to file was non-willful. You file the last three years of returns and six years of FBARs, with a signed certification explaining why you didn’t file. If you qualify and you live abroad, the offshore penalty is zero.

It’s FinCEN Form 114, the report of foreign bank and financial accounts. You file it if the combined high balance of all your foreign accounts crossed $10,000 at any point in the year — even for one day, even if no single account came close. It is separate from your tax return.

Different agencies, different thresholds, and you may owe both. The FBAR goes to FinCEN at $10,000 aggregate. Form 8938 (FATCA) goes to the IRS with your return, and its threshold starts at $50,000 and climbs into the hundreds of thousands depending on your filing status and whether you live abroad.

Usually not twice. Between the Foreign Earned Income Exclusion, the foreign tax credit and any treaty between the U.S. and your country, most expats end up owing little or nothing. But owing nothing and not having to file are completely different things. The return is still required.

You get an automatic two-month extension to 15 June, and you can push to 15 October with a Form 4868. Interest still runs from April, so an extension buys time to file, not time to pay.

Your bank is confirming whether you’re a U.S. person so it can report your account to the IRS, which foreign institutions are required to do. It’s routine — but it does mean the IRS is about to see the account, which is a good reason to be current before the report lands.

A foreign-owned single-member LLC files Form 5472 with a pro forma Form 1120 every year — even with no income and no activity. This surprises almost everyone. The penalty for missing it starts at $25,000 per year, which is why it’s the first thing I check.

Yes. Form 5472 is triggered by reportable transactions with related parties, including your own capital contributions, not by profit. A dormant foreign-owned LLC that never filed can quietly stack $25,000 penalties year after year.

You’re likely looking at Form 5471, and possibly GILTI or Subpart F income taxed to you personally before you’ve taken a single dollar out of the company. The penalty runs $10,000 per form per year, profitable or not.

In some states, probably. Since the Wayfair decision, states can tax sellers with no physical presence once you cross their economic nexus threshold — usually a dollar amount or a transaction count, set state by state. Marketplace facilitator rules cover part of it; sales through your own site almost certainly aren’t covered.

From the moment your entities transact with each other across a border — management fees, IP licences, intercompany loans, goods. There is no revenue floor. The documentation is what stands between you and an IRS adjustment under Section 482.

It’s the price your own companies charge each other across a border. Tax authorities require those prices to match what unrelated companies would have agreed — the arm’s length standard — so profit is taxed where the work actually happened rather than wherever the rate is lowest.

It’s your evidence. It shows a tax authority how you set your intercompany prices and why they’re defensible. Without it, the IRS gets to make its own assumption about what the price should have been, and you argue from behind.

The IRS can adjust your income under Section 482 and add net adjustment penalties of 20% or 40% of the additional tax, on top of the tax and the interest. Contemporaneous documentation is the specific thing that protects you from those penalties — written after the audit opens, it doesn’t count.

Four things: a map of which entities transact with which, a functional analysis of who does the work and carries the risk, benchmarking against comparable third-party deals, and the chosen pricing method with the reasoning behind it. Then it gets revisited as the business changes.