HIDING MONEY FROM IRS?
July 20, 2020 - Douglas Myser
Hiding money from IRS ? The Internal Revenue Service is getting better at finding secret stashes of overseas cash from people hiding money and tax evaders are receiving harsher penalties than ever, including prison. True tax evaders have for years intentionally hidden money offshore from Uncle Sam, often in multiple layers of entities such as trusts and foundations. Since a crackdown began in 2008, more than 55,800 people have paid more than $9.9 billion to come clean on such accounts. Others haven't stepped forward, hoping to escape notice. Now the dragnet is tightening further. Hiding money from IRS ?
The IRS is currently mining extensive data provided by banks in Switzerland and elsewhere to find scofflaws and their enablers. In a little noticed comment at a conference in late May, an IRS official said the agency has taken action on 100 potential criminal cases and another 14,000 potential civil cases as a result of this analysis. Justice Department staffers also are combing through data from the "Panama Papers" looking for U.S. tax dodgers, according to a person familiar with the matter. These documents which were published last year, contain account details for hundreds of thousands of offshore accounts.
Meanwhile courts this year have handed down prison sentences to at least seven people who were hiding money in offshore accounts, including a retired professor, a plastic surgeon involved in a divorce and five others. These sentences reverse a past trend in which courts imposed stiff financial penalties in offshore cases but little or no time in prison. One reason is that it's hard for defendants to claim ignorance of the law, given publicity around the crackdown. If you have offshore accounts with tax glitches caused by hiding money, don't panic, take action and contact a tax professional for help.
This group of Americans is large, as it includes many of the more than 7 million Americans currently living outside the U.S. Often these people were not hiding money abroad and paying taxes where they reside, but they haven't complied with complex U.S. tax rules on foreign accounts. Many were unaware that the U.S., unlike most nations, taxes nonresidents on world wide income and assets. Those that cheat may need Tax Resolution or worse.