What to Expect from an Initial ‘Free’ FBAR Consultation

What to Expect from an Initial ‘Free’ FBAR Consultation

Beware of the ‘Free’ Initial FBAR Consultation

In the world of international tax, a new tactic has emerged in which some tax law firms offer taxpayers a ‘free’ initial FBAR/FATCA/Offshore Disclosure consultation to discuss their case — but in reality, these are not ‘free’ consultations but rather fear-mongering telephone calls. Once the attorney gets the taxpayer on the telephone, their goal is to cause the taxpayer unnecessary panic and alarm. The Attorney scares the taxpayer into believing they will go to prison if they do not immediately sign with the lawyer — and of course, pay them an exorbitant fee for representation. Instead of allowing the Taxpayer time to consult with other (more experienced) Board-Certified Tax Law Specialists, the attorney admonishes the Taxpayer that they must sign up with the attorney right now or else their goose is cooked.

This often results in Taxpayers ultimately spending way more for representation than they should — as well as paying the lawyer for unnecessary services. Let’s go through some reasons why most experienced offshore disclosure specialist firms do not offer free initial consultations, to help assist you in your research quest about FBAR, FATCA, and more.

Free Consultations That You Are Charged For Later by Hourly Practitioners

We have seen a lot in our 25 years of practice, but the ‘free now, pay later‘ strategy even caught us off guard. We presumed it was a mistake, but after multiple clients came to us from the same attorney claiming to be an expert in FBAR and offshore disclosure — we realized it was just a sleazy tactic. 

The client claimed that they contacted the attorney because they were seeking a free consultation, and that based on the attorney’s marketing, the client believed this attorney was offering substantive free consultations. During the call, the attorney did little more than scare the taxpayer into believing that they were minutes away from going to prison for the rest of their lives — and so against the client’s better judgment, the client entered into an hourly agreement with the lawyer for representation in a Streamlined Offshore matter.

After just one week, the client received an exorbitant bill from the Attorney. In addition, the Attorney also demanded that the client replenish the retainer. The Taxpayer reviewed the first bill only to find that the attorney had included the initial call that was supposed to be ‘free,’ as part of the charges (the client knew the charge was for the initial consultation call because he had not yet had any subsequent calls with the lawyer).

When the taxpayer asked the Attorney about the charge, the Attorney told the taxpayer that it was free at that time of the call, but since the client retained the law firm, the Client would now be charged for that first call.  Needless to say, these taxpayers all disengaged from the lawyer.

Exorbitant Fees and Fear-Mongering

Another common issue we find with these types of attorneys is that they quote an exorbitant fee far outside the range that the taxpayer would receive from experienced specialists in offshore disclosure to accept the project. The idea is that the lawyer tries to scare the taxpayer into believing they have to act immediately and then quotes a very high fee, without giving the taxpayer any time to think or to consult with other attorneys in a paid, non-sales call environment.

This tactic is just a numbers game, and the Attorney assumes if they scare enough taxpayers during their free consultations, some taxpayers will (unfortunately) take the bait.

What Can You Accomplish in a 15-Minute Free Consultation?

Nothing substantive will be accomplished in 15 minutes.

The purpose of the 15-minute initial free consultation is to scare you into believing that you are in a much more dire position than you actually are – you are not going to receive any necessary substantive information in 15 minutes. The goal of this type of consultation is to have you going away with the unsettling feeling that if you do not hire that firm immediately then you are going to be in big trouble (which is rarely ever true).

Is a Partner Conducting the Consultation?

At our firm, Mr. Golding handles all initial consultations, and they are limited to matters specifically in the realm of areas we handle. When you are speaking with Mr. Golding, you are speaking with a Board-Certified Tax Law Specialist who specializes exclusively in international tax and offshore disclosure. Within the 30-minute time frame, Mr. Golding can assess your case and provide you with substantive information necessary to help you determine what your next steps might be. There is significant value in this type of consultation.

There is no sales pitch involved. Whether or not our firm ever hears back from you after the initial consultation, the consultation itself is designed to provide you with information about your options. While it does not include a document review or a post-consultation summary, those types of services are not typical of a 30-minute initial consultation. For that type of more detailed consultation, you will want to retain a firm that can provide you with an hourly quote (we are a flat-fee, full-service tax and law firm). A proper document review consultation will probably cost the taxpayer several thousands of dollars, as it will generally take at least a few hours of a lawyer’s time.

Specialized Tax Law Firms vs Mills

At Golding & Golding, we only handle one area of law: international tax offshore disclosure. We do not handle other aspects of tax law which is why we are able to direct all our resources and knowledge into this one specific area. Many other law firms have a broad area of focus and many times, are spread too thin. They try their hand at offshore disclosure but are simply mills. They take as many cases as they can and as many areas of tax law as they can handle. This may lead to a firm representing taxpayers in 10 areas of tax and not having any specialized knowledge in any one of those areas.

Our Consultations and Work are NEVER Farmed Out

We never farm out our consultations or our work. All matters are always handled in-house and Mr. Golding handles all consultations. At other firms, oftentimes you may speak with an associate who has possibly a few years of experience at most, or even a non-attorney who is trained to bring you in by way of a sales pitch about all the horrific things that may happen if you don’t hurry up and retain that firm (read: these horrific things never actually happen to anyone).

Be Careful of Firms Requiring Immediate Action

Another new sales tactic that has crept up in the past few years is that during one of these free initial consultation calls, the firm will admonish you to not reach out to any other attorneys to speak about the matter and that you must handle the case ASAP and only with that firm. It is important to note that if a firm tries this strategy, you realize what they are doing – which is to prevent you from getting the correct information. We recommend reaching out to a Board-Certified Tax Law Specialist that specializes in that particular area of law to discuss your case, so you have a thorough understanding of your paths forward.

Late Filing Penalties May Be Reduced or Avoided

For Taxpayers who did not timely file their FBAR and other international information-related reporting forms, the IRS has developed many different offshore amnesty programs to assist Taxpayers with safely getting into compliance. These programs may reduce or even eliminate international reporting penalties.

Current Year vs. Prior Year Non-Compliance

Once a Taxpayer missed the tax and reporting (such as FBAR and FATCA) requirements for prior years, they will want to be careful before submitting their information to the IRS in the current year. That is because they may risk making a quiet disclosure if they just begin filing forward in the current year and/or mass filing previous year forms without doing so under one of the approved IRS offshore submission procedures. Before filing prior untimely foreign reporting forms, Taxpayers should consider speaking with a Board-Certified Tax Law Specialist who specializes exclusively in these types of offshore disclosure matters.

Avoid False Offshore Disclosure Submissions (Willful vs Non-Willful)

In recent years, the IRS has increased the level of scrutiny for certain streamlined procedure submissions. When a person is non-willful, they have an excellent chance of making a successful submission to Streamlined Procedures. If they are willful, they would submit to the IRS Voluntary Disclosure Program instead. But, if a willful Taxpayer submits an intentionally false narrative under the Streamlined Procedures (and gets caught), they may become subject to significant fines and penalties. 

Need Help Finding an Experienced Offshore Tax Attorney?

When it comes to hiring an experienced international tax attorney to represent you for unreported foreign and offshore account reporting, it can become overwhelming for Taxpayers trying to trek through all the false information and nonsense they will find in their online research. There are only a handful of attorneys worldwide who are Board-Certified Tax Specialists and who specialize exclusively in offshore disclosure and international tax amnesty reporting. 

*This resource may help Taxpayers seeking to hire offshore tax counsel: How to Hire an Offshore Disclosure Lawyer.

Golding & Golding: About Our International Tax Law Firm

Golding & Golding specializes exclusively in international tax, specifically IRS offshore disclosure. 

Contact our firm today for assistance.