IRS Announces Second Offshore Voluntary Disclosure Program

On Feb 8, a IRS announced that it is starting a new module designed to move income hold in unfamiliar accounts behind into a U.S. taxation complement and to assistance taxpayers with income from offshore accounts to approve with sovereign taxation law. Under a program, taxpayers that divulge formerly undisclosed unfamiliar accounts and approve with a terms of a module can equivocate differently germane polite penalties and rapist prosecution.

The new 2011 Offshore Voluntary Disclosure Initiative will run by Aug 31, 2011. It is modeled on a IRS’ initial offshore intentional avowal program, that ran in 2009. The initial module resulted in intentional avowal by some 15,000 taxpayers. The IRS reports that another 3,000 have come brazen given a finish of that program.

The 2011 module handles penalties differently than a initial module did, and it requires participants to news and compensate taxes for 8 years instead of a 6 years compulsory in a initial program. Under a 2011 program, taxpayers will compensate a chastisement of 25% of a top total comment change in a taxpayer’s unfamiliar bank accounts during a years 2003 to 2010. This chastisement is in lieu of all other penalties that competence apply, solely for a disaster to file, disaster to pay, and accuracy-related penalties.

Individuals with offshore accounts or resources of reduction than $75,000 in any calendar year lonesome by a 2011 beginning will validate for a 12.5% chastisement rate. Some taxpayers will validate for a 5% rate, though usually in slight circumstances, including a box of unfamiliar residents who are unknowingly that they are U.S. citizens.

Participants in a module contingency compensate behind taxes and seductiveness for adult to 8 years as good as compensate accuracy-related and/or evasion penalties. They contingency record all strange and nice taxation earnings for a influenced years and embody remuneration for taxes, seductiveness and accuracy-related penalties by a Aug 31 deadline.

The IRS has also released 52 questions and answers that give endless sum about a 2011 module and about a polite and rapist penalties that might request to taxpayers that do not come brazen voluntarily.

About Emil Estafanous, CPA
Certified Public Accountant (CPA) Tax Professional committed in representing taxpayers and resolving their tax problems.

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