Voluntary Disclosure Renewed for Offshore Cheats
by Linda Beale
Voluntary Disclosure Renewed for Offshore Cheats
crossposted with Ataxingmatter
In 2009, the IRS provided a generous voluntary disclosure program for people who had money socked into offshore accounts. See 2009 Voluntary Disclosure Program, IRS. Ordinarily, the taxes, interest (at 20%), accuracy-related penalty (at 20% of the tax liability) and FBAR penalties –at 50% of the account amount over several years–could add up to considerably more than the amount in the account. The 75% penalty for fraud is a definitepotential, and criminal prosecution (for tax evasion, failure to file a return, filing a false return, etc.) is a possibility too. The 2009 voluntary disclosure program required taxpayers to reveal all previously undisclosed foreign accounts, amend their returns, and pay all taxes due. but the penalty charged was much less than the maximum–20% of the tax liability and 20% of the maximum amount in the account during the relevant period. See Q & A document.
When the ABA tax section met in Boca Raton Florida in late January, IRS officials announced that there will be a second voluntary compliance program for those persons who still have not come forward. Many practitioners with clients who may decide to participate in this second program had hoped that another would be offered even after the first program ended. To maintain credibility for future such programs, of course, the IRS will have to be sure that the penalties for disclosure at this later stage will be higher than the penalties for the earlier disclosure program. Nonetheless, paying the taxes due and a steep but still lesser penalthy while avoiding criminal prosecution should lead a number of the holdouts to disclose.
Someday we will have sufficent information exchange programs that will make hiding assets offshore close to impossible. But not yet. So let’s just hope that the IRS gets enough new information from these additional disclosures that it can pull the lid off even more of the banking secrecy in jurisdictions that have assisted US taxpayers in evading taxes for years. Each time there are significant new accounts revealed, it should be the case that the IRS will get numbers of leads on key bankers and mechanisms being used to hide assets offshore. You taxpayers who are gambling that they can get away with tax evasion through their offshore accounts should take notice. This will be your second chance. Now might be a good time to ‘fess up.
Hi Linda
it may be my criminal nature, but i found myself reading this from the point of view of someone who had a lot of money to hide from the tax man. “After all,” says I to myself, “It’s my money. My own hard work. And I hid it fair and square. Unlike the folks with even more money who got tax “breaks” by bribing their congressmen. So I am really really grouchy about the idea of “fessing up” and turning myself in. Besides I don’t trust them. They’ll find some way to renege on the deal and prosecute me for some crime I didn’t even know I was committing.”
Or will this amnesty program cover the corporations that move their assets off shore?
i’ve oft wondered where the kennedy’s parked all that money.
On what planet is confiscation of 20% of assets on which tax have already been paid “generous”?
Joe:
Ever visit or been in a level 4 prison? 20 hours lock down and 4 hours out plus meals. Typical prison for those sentenced to prison for 10+ years. Pay the 20%, its worth it and very generous after attorney fees and the restricted life style. Of course once there, you would be the cell block intellect and assigned an 8o cent/hour job tutoring and teaching other drug blown out prisoners trying to get their GEDs
run
joe is the sort of person who makes me repent of my criminal nature. and you, of course, are the one who scares me straight.
Coberly:
Got multiple stories to tell of prisoners and prison. If you ever wish to know what prison life is like and the court system, I can share my stories with you off line. However arrogant one might be, however powerful and rich one might be; the justice system is stilted to win regardless of the truth.
Coberly, I quote people that I know. Think about it.
run
i wan’t arguing with you. and my millions in ill gotten gains is safely stored under my bed where the IRS will never find it.
i got to watch the justice system more than i liked. one of the reasons i have such a healthy respect for the limits of human intelligence.
judges make the truth.
Coberly:
I know you weren’t arguing. I was being an ass for a reason. The court system is not a place to go to and expect justice.
Run,
i know that about the Courts. I can’t remember the name of the famous Justice who said something to the effect that the operation of the law would make a decent person gag.