IRS: Offshore programs have raked in more than $5 billion

On Tuesday, the tax-collecting agency also announced a new plan, to go live in September, that will help American citizens that have been living abroad and not paying U.S. taxes catch up with their obligations.
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The IRS started a third voluntary disclosure program for offshore accounts early this year, after similar programs expired in 2009 and 2011.

Users of the current program can expect a penalty of up to 27.5 percent, taken from the top amount a taxpayer kept in offshore accounts in any single year over the previous eight years.

The penalty for the 2009 program was 20 percent, and then rose to 25 percent in 2011.

Unlike 2009 and 2011, the current IRS initiative doesn’t have a deadline, but the agency warns that the provisions could change at any time.

In addition to the voluntary disclosure programs, the federal government has also employed the Foreign Account Tax Compliance Act to crack down on citizens using offshore accounts to cheat on their taxes.

The financial industry has said that FATCA is a burden on the banking and business community.