Last month, the Internal Revenue Service (IRS) announced a new settlement program targeted at taxpayers with offshore accounts.
As previously reported, IRS has become more aggressive in their efforts to identify taxpayers with offshore accounts who have not reported those accounts to the feds. Steep civil penalties apply and, in some cases, criminal charges could be imposed.
However, under a new six month settlement program, the IRS will trim the usual penalty to a one-time payment of 20% of the account value, or 5% for an inherited account so long as certain criteria are met. In most cases, that involves filing amended returns for the last six years.
In light of recent crackdowns – the most infamous being the investigation at UBS which reportedly resulted in more than 52,000 US held accounts being brought to light – some taxpayers may take this opportunity to come clean. The IRS hopes so. If not, they caution, you’d better watch out. Doug Shulman, Tax Commish at IRS warns:
“The IRS will be aggressive in pursuing people who shirk their obligations under the tax law. For people who are hiding money offshore, this serves as a wake-up call that they need to get right with their government.”
Consider yourself on notice!
