Have undisclosed bank accounts overseas? Maybe you’re hiding money overseas or maybe you’re not. In recent years, the IRS has been working diligently to find Americans with undisclosed overseas accounts and bring them to justice by serving up a harsh mix of prison sentences, criminal penalties, and civil penalties. But what if you are not committing criminal tax evasion? FATCA has been targeted at Americans with accounts overseas intended to avoid having to pay taxes on those funds. However, on June 3rd, the IRS Commissioner John A. Koskinen discusses a new area of emphasis for the IRS. The Commissioner announced the IRS sentiment that too much was being done to bring criminal tax evaders into compliance, and has failed to consider the innocent Americans with accounts overseas, and that discussions are underway to help these taxpayers comply.
As of yet, the Offshore Voluntary Disclosure Initiative (OVDI) has resulted in the collection of more the $6 billion in back taxes, interest, and penalties. Facing potentially harsh penalties, many American taxpayers with overseas accounts have taken advantage of the program and made noisy disclosures to avoid prosecution by the IRS. Now the IRS is weighing the potential benefit of creating a similar program for taxpayers who are not committing criminal tax evasion. The Commissioner promised forth-coming news about a potential program for American citizens living overseas with foreign held accounts, or recently American residents with foreign held accounts. Given the great success of the OVDI, such a program for other cases could generate substantial back taxes for the IRS.
We do not yet know what this new voluntary disclosure program could look like, but it is crucial for you to begin planning. Be prepared to take advantage of voluntary disclosure program to ensure that you are compliant and that your taxes are in order.
At the Tax Law Offices of David W. Klasing, our team of attorneys and CPA’s can help you determine the best course of action for your tax situation. Whether you are in the IRS’s cross hairs because you have been willfully failing to file your Reports of Foreign Bank Accounts or are and American resident with old accounts overseas, we can help you straighten out your taxes. We can help you make a noisy disclosure of your offshore accounts. Our attorneys and CPA’s can also help you navigate any potentially forthcoming disclosure programs that apply to you. Do not get caught on the wrong side of the IRS.