IRS Commissioner hints at fresh round of Voluntary Disclosure Program

During a speech in Washington, D.C. at the 23rd Annual Institute on Current Issues in International Taxation (I had attended the last one when the first program was mulled at), IRS Commissioner Doug Shulman indicated that the Offshore Voluntary Disclosure Program that ended on October 15, 2009 to encourage the account holders of Swiss bank UBS and other foreign banks to come forward and disclose their account holdings to the IRS was a huge success.

“We had approximately 15,000 voluntary disclosures from individuals who came in before the special VDP program ended last year,” he said. “And since the special program closed, we have received an additional 3,000 voluntary disclosures from individuals with bank accounts from around the world…..” IRS is closing the chapter on the UBS affair, but it has been “scouring the vast quantity of data” received from applicants to the voluntary disclosure program and from other sources. “Although more data mining is still to be done, this information has already proved invaluable in supplementing and corroborating prior leads, as well as developing new leads, involving numerous banks, advisors and promoters from around the world, including Asia and the Middle East.”

Shulman indicated that IRS is seriously considering another such program, however with a difference.  “Taxpayers will not get the same deal as those who came in under the original program. To be fair to those who came in before the deadline, the penalty – and thus the financial cost to participate – will increase. Let me say too that we expect to make the terms of any new program available to those who have already come in after October 2009 when that program expired. Stay tuned for more details as they become available.”

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