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Tomorrow is the deadline for Americans with offshore bank accounts to come clean to the IRS. Ever since Swiss bank UBS agreed to tattle on some of its American clients, Americans with offshore accounts have been faced with a choice — to tell or not to tell. Ashley Milne-Tyte reports.
Ashley Milne-Tyte: Barbara Kaplan of New York law firm Greenberg Traurig is working with about 70 clients who want to own up to the millions they’ve stashed abroad. Still, one out of 10 people who come to her decide to stay mum. She says they think they’re unlikely to get caught. But…
Barbara Kaplan: Worst-case scenario is if they’re discovered, the IRS can investigate them for both criminal prosecution with respect to their non-compliance with the tax laws and severe penalties can be imposed.
People are supposed to report offshore accounts containing more than $10,000. And pay taxes on the income. If they get caught, they can pay millions in back taxes and fines. Roberton Williams of the Tax Policy Center says coming clean has its complications too.
Roberton Williams: Then the IRS can open up your books for anything else and they talk to you about how did you find out about these, these accounts. Who was the broker that alerted you to this or what friends told you about it?
He says admitting it can mean dragging lots of people down with you.
I’m Ashley Milne-Tyte for Marketplace.