Failure to disclose accounts and filing false tax returns are crimes that carry prison terms and fines of up to $500,000, according to the IRS.
Reduced Penalties
Under the new program and the previous one, some taxpayers can qualify for reduced penalties as low as 5%. For the new program, that category includes people who inherited accounts that they haven't actively managed.
Unlike the 2009 program, the new program includes a separate penalty category for people who never had more than $75,000 in offshore accounts. They will be eligible for a 12.5% penalty. Taxpayers who participated in the 2009 program with account levels under that threshold can qualify for the reduced penalty, Shulman said.
Taxpayers who already are being audited can't participate in the program, nor can those who disclosed accounts in the 2009 program. Those who have made "quiet" disclosures by amending previously filed tax returns can apply.
The IRS started its disclosure programs amid efforts to crack down on offshore tax evasion fostered by UBS AG, Switzerland's largest bank.