Under new IRS rules for offshore bank accounts of U.S. citizens, the penalties for failure to come forward to the agency and report such holdings will result in significantly higher penalties–upto 50% of the balance in an accounts.
The changes are part of a five year effort of the agency to force greater tax compliance from millions of Americans with accounts in other countries.
If individuals inadvertently failed to comply with reporting laws, the new rules will make it less painful to come forward now. But going forward, failure to report will result in the stiffer fines and penalties.
In part as a result of the IRS mandates on foreign accounts, record numbers of citizens are cutting their ties with the country and establishing citizenship abroad.
Jeff Newman represents whistleblowers