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IRS adds to list of non-U.S. banks that trigger 50 percent penalty

| Jun 19, 2015 | Uncategorized |

When it comes to disclosing your offshore bank accounts to the IRS, waiting is a bad idea. In June 2014, changes to the IRS’s Offshore Voluntary Disclosure Program raised the penalty for having offshore assets that the IRS discovers without your voluntary disclosure.

The penalty for voluntary disclosure is 27.5 percent for your single highest account balance during the last eight years. If the IRS discovers offshore assets that you did not voluntarily disclose, then the penalty is increased to 50 percent of your highest balance for every year not reported. In other words, it is possible in some cases that the civil penalties would exceed an individual’s entire offshore account balance.

The U.S. government also continues to reach deferred prosecution agreements with non-U.S. banks, and the IRS has a long list of banks that automatically trigger the 50 percent penalty if you have an account with them.

The first of those banks were added to the list in August 2014, and most recently the following banks were added to the list:

  • Finter Bank Zurich AG
  • LBBW (Schweiz) AG
  • Societe Generale Private Banking (Lugano-Svizzera) SA 
  • Scobag Privatbank AG
  • MediBank AG
  • Banca Credinvest SA
  • Rothschild Bank AG

If you have offshore assets, then don’t hesitate to speak with a voluntary disclosure attorney about your options. Time is of the essence in these matters.

It should be noted, too, that some taxpayers with offshore accounts may be eligible for the less costly streamlined programs, which require taxpayers to certify that their tax non-compliance was due to non-willful conduct.

In any case, the stakes are too high not to seek legal help.


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