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Archive for 28. April 2009

The Price of Hiding Money Offshore

According to a recent Wall Street Journal article US citizens who saw fit to stash money offshore are reluctant to come clean with the IRS. Especially those with large losses.

Last month the IRS introduced limits on tax penalties hoping to coax offshore investors to come clean.

The IRS penalty limits apply to voluntary disclosure cases already under way, and to people who step forward within the next several months. Account holders must pay back taxes and interest for six years, and an additional penalty on all six years. In addition, they owe a penalty of 20% of the amount in the account in the year when it was worth most during the past six years.

One wonders what the penalities are for those that choose not to disclose but are caught!

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