February 03, 2011
IRS to Announce a New Voluntary Disclosure Program for Offshore Bank Accounts
On January 24, an IRS spokesman stated that the IRS would soon formally announce a new voluntary disclosure program to encourage U.S. taxpayers with hidden offshore financial accounts to declare their accounts and pay the taxes owed.
The spokesman said that the terms offered under this new program would not be as generous as those offered to taxpayers under a similar voluntary disclosure program last year. The previous program, which ended last October 15, provided for a single penalty equal to 20% (reduced to 5% in certain cases) of the highest balance or value in the offshore account over the previous six years, in lieu of separate penalties for each of the six years.
The announcement of the new program is expected to come before the April 15 filing deadline. As under the prior voluntary disclosure program, a taxpayer will likely not be eligible to participate in the new program if the taxpayer's identity has already been disclosed to the IRS.
The new voluntary disclosure program is part of a continuing effort by the IRS and Congress to crack down on U.S. taxpayers with hidden offshore assets. We expect these efforts to only increase in the future.
If you have any questions concerning this Tax Flash, please contact your Marcum International Tax Professional.