Internal Revenue Service Commissioner Doug Shulman said the agency may reopen its voluntary disclosure program, offering a partial amnesty to tax evaders who have been hiding money in foreign bank accounts.
During a speech on Dec. 9 in Washington at the 23rd Annual Institute on Current Issues in International Taxation, Shulman described the success of a program it had offered last year to encourage customers of UBS AG and other foreign banks to disclose their account holdings to the IRS.
"We had approximately 15,000 voluntary disclosures from individuals who came in before the special [voluntary disclosure] 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."
Shulman said the IRS withdrew its "John Doe Summons" against unidentified UBS account holders last month, and attributed that to the success in getting the account holder information sought through the summons and obtained under an August 2009 agreement with the Swiss government and UBS.
Shulman said the IRS was "closing the chapter on the UBS affair," but said 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, advisers and promoters from around the world, including Asia and the Middle East."
Shulman said that given the success of the program, the IRS is seriously considering another special offshore voluntary disclosure program. "However, there will be some fundamental differences," he said. "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."
