The IRS is expected to launch a new offshore bank account tax amnesty very soon announced Steven Miller, IRS Deputy Commissioner for services and enforcement. He made the announcement at an American Bar Association Tax Section Meeting in Boca Raton, Florida. The program which is sometimes referred to as the offshore voluntary disclosure initiative allows taxpayers who failed to file FBARs, or to report income from foreign bank accounts avoid criminal tax evasion, and other criminal tax charges. It will also allow FBAR non-filers to avoid the steep 50% penalty imposed under the Bank Secrecy Act for failure to file an FBAR.
Miller warned, however, that the new offshore voluntary disclosure program will not be as generous as the previous program which ended on October 15, 2009. Under the prior program taxpayers who voluntary disclosed the existence of their offshore financial accounts had to pay the tax on the unreported income, plus interest, plus a 20% accuracy related penalty AND 20% of the highest balance in the offshore account. Miller did not disclose what the penalty structure would be under the voluntary disclosure program. Our tax lawyers believe that if the penalties under the new IRS offshore tax amnesty are too high it will discourage some taxpayers from coming clean.
Miller noted that the IRS received 15,000 disclosures under the first offshore voluntary compliance program, and has received another 3,000 voluntary disclosures since Oct. 15, 2009.
If you have an offshore bank account whether in Switzerland, India, China or some other country and you would like to discuss your options contact the tax litigation lawyers at Brager Tax Law Group, A P.C.