Offshore tax amnesty extended

The IRS means it this time. Really.

The tax man is giving owners of offshore accounts, suspected of being used to evade taxes, extra time to 'fess up.

The deadline was Wednesday, Sept. 23.

It's been pushed to Oct. 15.

The great tax confessional program is part of an effort initiated in March to get folks with hidden accounts to voluntarily disclose them. If they don't, and the IRS discovers the accounts in which you might, possibly, perhaps have been hiding taxable income from Uncle Sam, then you'll face, says the tax agency, much harsher civil penalties and potentially criminal prosecution, too.

Now if might look like the IRS is backing off in its attempts to clamp down on offshore accounts. Not so, says the agency.

IRS officials say they decided to extend this week's deadline after receiving repeated requests from tax practitioners and attorneys, who were themselves reacting to "an influx of taxpayer requests." That seems to indicate that lots of folks are at least interested in turning over information to the feds.

So by extending the deadline for a short period of time, the IRS is providing relief for those well-intentioned taxpayers who are just having some "logistical and administrative challenges" in meeting this week's due date.

The extra three weeks should give tax preparers and attorneys who work with these account holders "the necessary time to interview and advise their backlog of taxpayers … and prepare the necessary paperwork to qualify for the special penalty provisions."

It's not that I doubt the sincerity of the offshore account holders. I'm sure they fully intend to the do the right tax thing … now that the IRS has renewed efforts to shut down offshore tax evasion schemes.

But this allowance of extra time also reminds me of kids who put off doing what their parents tell them to do until the folks finally put the hammer down. Too often, these kids know they can keep getting away with stuff and they take full advantage of the parental grace periods.

I sure hope the IRS is a stricter "parent," and is sincere in it's announcement that there will not be any more offshore account amnesty extensions.

Comments

[Toni McIntyre]

You know the tax practitioners are going to complain about that deadline too since it is the same as 1040 extensions.

[Megan Donahue]

The reason so many people have moved their assets in to these offshore accounts is because for decades the IRS has not done anything to stop them from doing so. Tax evasion is such a common thing now that it is hardly talked about anymore. It is nice to see that something is finally being done. It makes you wonder if there is any privacy anywhere in the world now. Swiss banks, as well as banks in other countries, are giving up information to the United States so obviously personal information is not a private issue anymore. I think this IRS crackdown is a good thing for the United States because it will increase tax revenue and hopefully help the Federal Reserve to stop printing money, like we are not in enough debt as it is, to balance its books. Some people who are not aware of the how bad the situation might be are still going to sit and hide until the government finds them. Do you think the ones who come forward are not going to be hit hard by the IRS? Some of the news articles I have read said that some will only have to pay 5 percent of taxes, while others are saying it is closer to 50 percent. What is the reality of the amnesty program? The IRS should have started these investigation years ago and maybe then it would have decreased the number of people who sent their assets overseas. Well for the people who do not turn themselves in it will just be a matter of time before the IRS finds you and takes everything. You have the money to pay taxes so play by the rules like the rest of us and we would not have to worry about problems like these. You are right about one thing, with the IRS changing the grace period; people are going to think that they are always going to get a second chance. Well we will have to wait till October 15th to see how serious the IRS really is. These crooks that do not come forward better watch out because the IRS is coming for you!