Back in 2009 it was required that individuals living or residing in the United States and earning or holding a sum that exceeded $10,000 outside the country needed to report their financial standing to the IRS amnesty program. Then, the deadline was October 15, 2009. Complying would allow the holder to avoid any addition fees, outside of taxing, for having US currency overseas. Upon release of this program many holders were ill-informed causing them not to report their earnings. The IRS pursued such individuals but they fought back for having received little to no information on the new laws regarding the federal tax amnesty program.
The IRS reconsidered their first advance and reestablished their program. This time, special efforts were made to get the program’s information to individuals with high-yielding incomes overseas. It was then announced on February 8, 2011, that the IRS would be enacting the newly formed 2011 Offshore Voluntary Disclosure Initiative. This leaves high-income owners less than 100 days in total to report their earnings offshore for amnesty. After the deadline they will be tried criminally for money laundering and tax evasion.
It is important for clients with high-yielding incomes overseas to report all of their earnings to the IRS before the amnesty program is up; while the program represents a second chance for some, it is unlikely that the IRS will provide a third. The IRS is cracking down hard on those committing tax evasion, so be prepared and talk to your financial advisor today.