7,500 seek amnesty for hiding assets
WASHINGTON - About 7,500 international tax dodgers have applied for an amnesty program that promises no jail time and reduced penalties for tax cheats who come forward, the Internal Revenue Service said yesterday. They were hiding money in more than 70 countries and on every continent except Antarctica. Account values ranged from just over $10,000 to more than $100 million.
Response to the program has been unprecedented, IRS Commissioner Doug Shulman said. “The whole idea . . . was to get people in and get them on the right side of the law,’’ he said.
The IRS long has had a policy that certain tax evaders who come forward can avoid jail time as long as they agree to pay back taxes, interest, and hefty penalties. Drug dealers and money launderers need not apply. But if the money was earned legally, tax evaders can usually avoid criminal prosecution. Fewer than 100 people apply for the program in a typical year, in part because penalties can exceed the value of the hidden account.
In March, the IRS began a six-month amnesty program that sweetened the offer with reduced penalties for people with undeclared assets. The program was extended once, until today. Shulman said it will not be extended again.
The program is part of a larger effort by the Obama administration to crack down on Americans who evade US taxes by hiding assets overseas. In August, the United States and Switzerland resolved a court case in which Swiss banking giant UBS AG agreed to turn over details on 4,450 accounts suspected of holding undeclared assets from Americans.
Shulman said the IRS is stepping up efforts to track illicit money and opening offices in Beijing, Panama City, and Sydney to pursue criminal cases.
Shulman said the IRS is still processing applications for the amnesty. It is too early to know how much money will be recovered, he said.
