The IRS Limited Amnesty Program: What are the Consequences?
Article provided by Frank Rubino
Earlier this year, the United States Internal Revenue Service (IRS) reached an agreement with Swiss banking giant UBS. The agreement is centered upon deferring prosecution of UBS for charges of conspiring to defraud the U.S. government by interfering with the IRS. UBS authorities have accepted responsibility for their failure to disclose vital account holder information to American tax authorities, thus allowing those customers to avoid millions of dollars in tax liability. In exchange for the charges being dropped, UBS agreed to disclose the identities of account holders, no longer providing banking services to customers who have not declared their accounts with the IRS and also pay nearly 800 million in fines.
As a result of learning that their identifying information will be disclosed to IRS officials, many account holders have decided to proactively declare their assets to the government. Thousands of customers have come forward, wishing to reap the benefits of the government’s so-called “limited amnesty” program. The program is designed to allow for significant civil penalties for failure to pay past taxes, but it will generally prevent the filing of criminal charges for those same failures.
Those claimants who are able to take advantage of the limited amnesty program will face steep civil consequences, including full repayment of all back taxes owed, interest on those amounts, legal fees, accountant fees and a fine in the amount of 40 to 60 percent of the account balance. In spite of this high monetary price, many UBS account holders are frantically seeking acceptance into the program, placing a much higher value on freedom and a clean criminal record.
If you fear you may be affected by the disclosure of UBS records, you are likely wondering about the effects of declaring your personal or business accounts. The advice of an attorney well-versed in tax law can be invaluable in helping you weigh your options and make a truly informed decision about how best to proceed.