More than two years ago, the IRS issued guidance that requires you to make sure you know how to make a payment using a foreign intermediary.
But now, with the guidance in place, many people are using the advice to pay for their foreign intermediary accounts.
In fact, the Federal Trade Commission has taken issue with the IRS’s guidance.
The FTC said the IRS is forcing many people to pay a penalty when they make a foreign transaction through their intermediary.
“We’ve heard from several consumers who were surprised to learn that the IRS will require a $10,000 or $25 in fines for a $1,000 transaction,” FTC Chairman Jon Leibowitz said in a statement.
“That’s not right.
Foreign intermediaries should be able to do business with Americans, not forced to make big, secret payments to avoid scrutiny.”
The IRS did not immediately respond to The Hill’s request for comment.