IRS Representation
Form 1040-X, Form 1116, Form 5471, Form 5472
Representation before the IRS for people and businesses with UK ties, from answering notices to penalty relief and payment arrangements.
What does IRS Representation involve?
IRS letters are written for people with a US address and a US phone line. From the UK they arrive late, the deadlines in them keep running, and the options they describe assume you know the process. With your authority on Form 2848 we deal with the IRS directly and keep the UK position in view.
Forms and filings involved
- Form 1040-X
The form for correcting a Form 1040 already filed, whether to add missed income, switch relief methods or claim a refund.
- Form 1116
The form that turns UK income tax into a credit against US tax on the same income, with carryovers for unused amounts.
- Form 5471
The information return a US citizen or green card holder files for a UK limited company they own, control or have acquired an interest in.
- Form 5472
Reporting for US corporations with a significant foreign owner, and for single-member US LLCs owned by someone outside the US.
- FinCEN 114
The annual report of foreign accounts filed with FinCEN, separate from the tax return, once combined balances pass the threshold.
Dealing with the IRS from the UK
Most IRS contact starts with a notice. Some are automated, such as a proposed adjustment when third-party information does not match the return, or a balance due letter.
Others open an examination. Each gives a response date measured from the date on the letter, not the date it reached you, which matters when post from the US takes weeks. We read the notice, establish what the IRS thinks is missing, and reply with the documents that answer it.
Many notices sent to Americans abroad stem from foreign items. Foreign tax credits claimed without support, a missing Form 1116, UK pension income reported inconsistently, or an information return left out of an otherwise complete filing can each lead to letters or penalties. Some international information return penalties are assessed automatically when a form is filed late. Relief may be available for reasonable cause, or under the first-time abatement policy for certain penalties, and a request should set out the facts in detail.
Where tax is owed and cannot be paid at once, the options include short-term extensions, instalment agreements and, in limited cases, an offer in compromise. Unpaid debts have wider consequences for people abroad. Seriously delinquent tax debt can be certified to the State Department, which can affect a passport application or renewal. The IRS also receives account information from UK banks under FATCA, so an unanswered letter rarely goes away on its own.
How we act for you with the IRS
- 01
- Form 2848 filed so the IRS will speak to us directly
- 02
- Notice reviewed and response deadline confirmed from the letter date
- 03
- Written replies with supporting UK documents converted to dollars where needed
- 04
- Reasonable cause and first-time abatement requests drafted from the facts
- 05
- Instalment agreement or offer in compromise where tax cannot be paid
Who this is for
Americans in the UK who have received an IRS notice or letter
- Businesses charged penalties for late Forms 5471 or 5472
- Taxpayers with a US balance they cannot settle in one payment
- Families dealing with the IRS on behalf of an elderly relative
Why US UK Tax Returns
Each return is prepared with the other country's return open beside it, so a credit, election or disclosure on one is supported by the other.
One File
US and UK returns prepared in the same engagement and reconciled line by line.
Primary Sources
Every position traced to the Code, the treaty, IRS instructions or HMRC guidance.
Scope First
Returns, forms, years and fee agreed in writing before work begins.
The Same People
The team that files this year carries the elections and credits into the next.
Questions we are asked
The IRS says my return does not match its records. Do I have to accept the change?
No. A proposed adjustment notice sets out what the IRS thinks is wrong and asks you to agree or disagree by a stated date. If the IRS is missing something, such as foreign tax credit details or the cost of shares sold, a written response with documents often resolves it. If you do nothing, the adjustment usually moves towards a formal assessment. Whether to agree depends on whether the IRS figures are right.
I was fined for filing Form 5471 late. Can the penalty be removed?
Sometimes. The $10,000 penalty can be abated where the failure was due to reasonable cause and not wilful neglect, and the request needs a detailed account of what happened and when you learned of the requirement. Relief is not automatic, and the standard is applied strictly. Where the penalty has not yet been assessed, the delinquent information return procedures may offer a better route, depending on the facts.
Can I talk to the IRS myself, or do I need someone to do it for me?
You can deal with the IRS yourself. The practical difficulty from the UK is contact: international phone lines have limited hours and post is slow. A representative authorised on Form 2848 can speak to the IRS on your behalf, receive copies of notices and respond within the deadlines. The authorisation covers only the tax types and years listed on the form, so it should match the matters in question.
Primary sources
What this page says is drawn from the official material below. Read it yourself; we would rather be checked than trusted.
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