NRI body seeks relief on US penalties on foreign accounts

September 16th, 2011 - 10:14 am ICT by IANS  

Barack Obama Washington, Sep 16 (IANS) A US based organisation of people of Indian origin has sought help from a leading lawmaker in getting relief on penalties under US tax rules on non disclosure of foreign accounts.

Global Organization of People of Indian Origin (GOPIO) Chairman Inder Singh met with Howard Berman, top Democrat on the House Foreign Affairs Committee, seeking his help for relief on penalties under Report of Foreign Bank and Financial Accounts (FBAR) and Offshore Voluntary Disclosure Initiative (OVDI) schemes.

Singh told Berman that the letters sent to President Barack Obama and US tax authorities did not receive any positive response from the Internal Revenue Service Commissioner.

Berman, according to a GOPIO release, assured that he would have his staff look into various situations and extend help where possible and practical.

Singh suggested to Berman that the current limit to report about someone having a foreign bank account be raised from $10,000 to $25,000 taking into account the current cost of living index.

He also suggested that the penalties be waived if less than $25,000 has been sent abroad for supporting parents or members of the extended family or money in foreign banks was from inheritance received before migrating to the United States.

Singh also sought exemption for the temporary workers, such as H1B and L1 visa holders as they were never told about compliance with such laws while taking up jobs in the US.

Even if a penalty were to be imposed, it should be on the income rather than the highest balance from 2003 to 2010, he said. “After all, it was not money laundering but genuine transfer of money for buying property, for investment or children’s education.”

(Arun Kumar can be contacted at arun.kumar@ians.in)

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