IRS steps up scrutiny of the very rich

TEXT OF INTERVIEW

Stacey Vanek-Smith: Congress isn’t the only one tackling big issues. The IRS is launching a new enforcement unit targeting the wealthy. Here to talk about that with us is our very own Ashley Milne-Tyte. She joins us live. Hi Ashley.

Ashley Milne-Tyte: Hi.

Vanek-Smith: So tell me, what is going on?

Milne-Tyte: So the IRS has started this unit they’re calling the Global High Wealth Industry Group. And the idea is that this group is going to work on kind of uncovering some of the ways wealthy people hide their income. So they’re going to be scrutinizing partnerships, offshore accounts, and trusts. Things like that.

Vanek-Smith: This seems like part of the bigger crackdown we’ve been seeing this year on the uber-wealthy. Is it?

Milne-Tyte: Yes, I think it is. I mean earlier this year, a whistle blower at the Swiss bank UBS let the IRS know that a lot of wealthy Americans have accounts at UBS. And if you have an offshore account that contains more than $10,000, you’re supposed to report that to the government and pay taxes on the income. But with these accounts at UBS, generally they had way more than $10,000 in them, and no one was paying taxes.

Vanek-Smith: Was that what sparked the hunt for offshore account holders?

Milne-Tyte: Yeah, the IRS put the word out that it was really paying attention to this area. And they announced a tax shelter amnesty period that just expired earlier this month. So people could come forward, reveal their hidden riches and pay back taxes. So anyone who’s still keeping quiet about large amounts they may have stashed somewhere sort of risks a more assiduous IRS hunting them down. They could end up paying up huge fines. We should say more — in some cases — than the actual value of their accounts. And they risk jail time as well.

Vanek-Smith: Ashley Milne-Tyte, thank you.

Milne-Tyte: You’re welcome.