One Week Remains: January 15, 2010 Deadline to Disclose Offshore Accounts

The disclosure of previously undisclosed offshore accounts for individuals, trusts, and companies around the world continue.  Many of my clients have been “thankful” that the IRS Criminal Division has given U.S. taxpayers participating in the IRS Offshore Settlement Initiative Program (“Initiative”) untilJanuary 15, 2010 to provide additional information to the IRS concerning offshore accounts.  Thus, U.S. taxpayers with accounts in foreign banks have only 1 week left to make a complete voluntary disclosure of their accounts to the IRS or risk facing increased monetary penalties – which can exceed the value of the account – and potential criminal prosecution.  Although, I am still hopeful the IRS will give taxpayers more time to gather their information and come forward. 

Additionally, taxpayers who failed to enter the Initiative may still potentially take advantage of the Initiative’s reduced penalty framework by filing before January 15, 2010.  The IRS has expressed some willingness but no guarantees to negotiate penalties under the terms of the Initiative.  However, to potentially take advantage of this stance, taxpayers should come forward before the IRS Criminal Division’s January 15, 2010 information collection deadline.