Recently, UBS announced that it had agreed to release the names of 4,450 of its account holders to the IRS. This is unsettling news for taxpayers with undisclosed foreign accounts. However, the IRS currently has a Voluntary Disclosure Program to encourage tax payers with unreported foreign accounts, unfiled tax returns, under reported income or frivolous tax deductions to participate and avoid further penalties and criminal prosecution.
- Taxpayers must apply to the IRS before the IRS contacts the taxpayer.
- On August 25, 2009, the IRS announced that UBS account holders would be eligible until the IRS received the information. Apparently, UBS is notifying its account holders before turning the names over. See IRS Voluntary Disclosure: Questions and Answers
This is crunch time! UBS account holders are not the only taxpayers with unreported foreign accounts who should be concerned. The disclosure program is about to terminate.
- Taxpayers have only until September 23, 2009 to participate in the program.
- Voluntary disclosure will allow a taxpayer to avoid criminal prosecution and the assessment of significant IRS penalties. A taxpayer will still have to pay the income taxes, accrued interest and some penalties.
- Taxpayers only have one opportunity to make a submission, and failure to qualify for the program, depending on the facts, may lead to criminal prosecution.
If you are interested in a confidential discussion with an attorney about this important opportunity, you may call us at 503-226-2966.