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IRS warns of fines and jail time for offshore bank account holders

In our last post we discussed a recent speech by IRS Commissioner Douglas H. Shulman on offshore bank accounts and the IRS' continuing pursuit of California residents with undisclosed foreign assets. The IRS is going to continue to pressure banks and foreign governments to disclose the identity of California taxpayers with hidden assets. Shulman said that the IRS has more tax evasion cases and banks on its radar and that he expects a new wave in tax evasion prosecutions in the coming years.

The IRS Commissioner highlighted the thousands of taxpayers who took advantage of the recent voluntary disclosure programs. These programs allowed taxpayers to avoid the stiff criminal penalties associated with tax evasion cases and to return to the standard reporting system. The IRS Commissioner said that he hopes the IRS' aggressive pursuit of offshore bank account holders will "change the calculus" of would-be tax evaders and discourage wealthy California individuals from hiding money overseas.

"I think it's fair to say that we are well on our way to deterring the next generation of taxpayers from using hidden bank accounts to cheat on their taxes," the IRS Commissioner said. "People who may consider hiding money offshore should also take note of ours and the Department of Justice's success record when it comes to criminal prosecutions. People hiding assets offshore have received jail sentences running from months to years, and they have been ordered to pay hundreds of thousands and even millions of dollars."

Exorbitant fines and jail time can often be avoided in tax evasion cases. An experienced tax law attorney can help a client avoid such drastic consequences which is why experienced representation is vital in any tax evasion case.

Source: IRS, "Commissioner Douglas H. Shulman Speaks at the IRS/George Washington University 24th Annual Institute."

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