The IRS initiated a new National Research Program Initiative in November 2009 simply known as the Initiative: an industry wide detailed audit of employment taxes for 6,000 randomly selected businesses for the duration of the next three years. The intent of the Initiative has two aspects: ONE: assess systemic employment tax compliance; and TWO: collect assessments from delinquent employers.

In the wake of the Internal Revenue Service (IRS) Offshore Settlement Initiative Voluntary Disclosure Program and UBS AG investigation, there will likely be a surge in IRS Information Document Requests focusing on offshore bank accounts.  Offshore tax evasion remains a top enforcement priority for the IRS, which will continue to step up pressure on U.S. taxpayers with undisclosed offshore accounts.  The Information Document Request will be the next step in the IRS’s enforcement strategy. 

Taxpayers who missed the deadline for the Internal Revenue Service (IRS) Offshore Settlement Initiative Voluntary Disclosure Program can still file a traditional Voluntary Disclosure under the IRS’s normal filing strictures.  It is clear that offshore tax evasion remains a top enforcement priority for the IRS and the IRS will continue to step up pressure on U.S. taxpayers with undisclosed offshore accounts.  Voluntary disclosure provides U.S. taxpayers with previously undisclosed offshore accounts a way to avoid the harshest penalties and potential criminal prosecution.

On Tuesday, November 17, 2009, the Internal Revenue Service (IRS) and U.S. Department of Justice (DOJ) released information on the highly-publicized Settlement reached with Swiss banking giant UBS AG (UBS). According to recently released information, over 14,700 U.S. taxpayers agreed to participate in the Offshore Settlement Initiative Voluntary Disclosure Program, instituted as a way for taxpayers to disclose and avoid the harshest penalties.  Further, the IRS has disclosed the criteria set forth in the “John Does” Settlement that has led UBS to turnover thousands of U.S. taxpayer clients.  The criteria serves as a guide to future investigations as the IRS and DOJ continue to investigate and prosecute U.S. taxpayers who fail to disclose their offshore assets to the U.S. government.