Offshore Task Force Cracks Down on Tax EvasionOffshore Account Update
Posted on April 30, 2018 | Share
Individuals with offshore funds have had a lot to be concerned about in recent years as the IRS has been aggressively going after people with accounts at foreign financial institutions who failed to comply with reporting requirements.
The Offshore Voluntary Disclosure program encouraged many individual accountholders to come forward and disclose their accounts to limit financial penalties and to avoid the risk of criminal prosecution, while the Swiss Bank Program resulted in many major financial institutions turning over accountholder information and paying fines to avoid being prosecuted. All of this information from foreign financial institutions is in the hands of the IRS, so those with undeclared offshore funds are at risk of being investigated.
As if all of this wasn't enough to cause justifiable worry among accountholders with accounts at foreign banks, the IRS is now adding another cause of concern to the list: a dedicated tax force has been created to handle international tax enforcement. This means there's an even greater likelihood that you'll come under investigation for having an account offshore that's not in full compliance with the rules.
A New Jersey tax audit attorney can help you to assess the risks you face and to determine the best course of action for reducing the likelihood of serious IRS penalties. An attorney can also help if you are already under investigation and worried about the outcome.
IRS Creates New Taskforce to Crack Down on Global Financial Evasion
The new task force that the IRS has created will consist of 10 full-time agents who will be focused solely on international tax enforcement. The 10-person tax team will work with the IRS criminal investigation unit, so experts from both teams can pool their resources and take a more strategic approach to investigating offshore investments. The team can make use of information from every federal tax return and from reports of suspicious activity from financial institutions in order to launch targeted investigations.
The criminal investigation unit has already significantly ramped up the number of cases connected to international tax issues, and their partnership with the task force is likely going to serve to accelerate that trend.
The criminal investigation unit initiated a total of 283 investigations into international tax issues in fiscal year 2017, which was an increase from the 186 international cases in 2015 and the 221 international cases in 2016. The increase may not seem that substantial, but it happened at a time when the total number of completed investigations fell from 3,843 in 2015 and fell from 3,395 investigations in 2016. While the criminal investigation unit handled fewer cases overall, more of them were related to international tax issues. And, that was before the dedicated task force teamed up with this unit.
The strong focus on investigating international tax issues puts you at significant risk if you have foreign financial accounts that you haven't declared or if you are otherwise not in full compliance with the law in connection with offshore investments. Contact New Jersey tax audit attorney Kevin Thorn to find out what the potential consequences could be if you come under investigation and to determine the best approach to take now to reduce the likelihood you could find yourself facing legal trouble with the IRS.