More On Tax Planningfrom The Advisor's Professional Library
- IRAs: In General Individual Retirement Accounts are highly popular tools for contributing funds that grow on a tax deferred basis. Depending on the type of IRA, the accumulation can be tax free.
- Long Term Care Insurance: Premiums While premiums for qualified long-term-care insurance may be deductible as medical expenses there are exceptions to this general rule. Learn how to avoid unnecessary tax liabilities.
The IRS has announced a new amnesty program aimed at encouraging wealthy Americans with hidden offshore bank accounts to come forward, declare their money and pay taxes owed, according to a report in The New York Times on Tuesday.
An IRS spokesman quoted in the report declined to give details, but said the program would be formally announced “very shortly” and would not offer terms as generous as those put forth in a similar initiative last fall. At press time, an IRS spokeswoman again declined to comment on the new program.
An earlier so-called voluntary disclosure program, which ended last Oct. 15, was used by some 15,000 Americans with hidden accounts, and an additional 3,000 with accounts at various offshore banks came forward after the deadline, according to The Times.
Under the previous program, taxpayers who came forward before Oct. 15 were subject to a reduced penalty of 5% to 20%, depending in part on whether their wealth was inherited. They were also penalized just once, on the highest balance in their affected accounts over the previous six years, instead of for each of the six years.
The report said the IRS will not offer those terms in the coming amnesty, leaving those who come forward potentially owing the IRS a multiple of what their account holds.