IRS Offers Criminal Amnesty to Offshore Account Holders
March 30, 2009 by RickBryan
The IRS announced the other day that they were willing to forgo criminal prosecution of US taxpayers who held (and failed to report and pay tax on) accounts held offshore.
As reported by Thomson Reuters/IRS,
IRS Commissioner Doug Shulman has announced what is in effect a settlement offer for those that voluntarily and timely disclose unreported offshore income. Those meeting the terms of the offer will have to pay back-taxes and interest for six years, and pay either an accuracy or delinquency penalty on all six years. They will also pay a penalty of 20% of the amount in the foreign bank accounts in the year with the highest aggregate account or asset value. In other words, 20% of the highest asset value of an account anytime in the past six years. However, those who come forward on a timely basis will not face criminal prosecution.
Penalties and interest will be painful, no question about it. However it seems like a prudent move insofar as the Service has (or is in the process of) receiving data from foreign banks and financial institutions on US citizens which had been protected under foreign government secrecy laws.
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