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Offshore accounts are on IRS radar

The Internal Revenue

Service is on the warpath, seeking large financial accounts of U.S. citizens and residents held overseas.

At the same time, the IRS is offering a temporary olive branch. Come forward now, the tax collection agency says, and pay any penalties and back taxes.

If you don”t, and the IRS finds out later, it probably means jail time, just as it did before the new amnesty program.

The IRS recently started its second amnesty program, which invites voluntary disclosure of offshore money and its income. The program expires Aug. 31.

When the IRS conducted its first amnesty program in 2009, about 15,000 foreign accounts in 60 countries were disclosed.

Between 100 and 150 of the disclosures in 2009 come from the San Antonio area, said Elizabeth Copeland, a tax lawyer with Oppenheimer, Blend, Harrison and Tate Inc. law firm. Copeland”s firm handled about 25 of those cases.

It is not against the law for U.S. citizens and

residents to maintain overseas accounts. It is against the law for them not to report those accounts and their incomes to the IRS every year, Copeland said.

The IRS requires information on foreign accounts totaling more than $10,000.

The IRS is getting better at finding undisclosed foreign bank accounts. “Tax secrecy continues to erode,” said IRS Commissioner Doug Shulman in a statement. “The risk of being caught will only increase.”

People hiding money have more to fear than just the IRS efforts. WikiLeaks in January said it had received information on more than 2,000 Swiss bank accounts, which it could release vigrx plus fraud at any time.

A Las Vegas-style bookie,, is even taking bets, posting odds on a list of movie stars, financial big shots and politicians it says could be on the WikiLeaks list.

The bigger wild card out there, Copeland said, is the IRS whistle-blower program that can pay rewards for tips on hidden foreign bank accounts. Rewards can range between 15 percent and 30 percent of the money the IRS collects from tips, Copeland said.

Ex-spouses often are tipsters, Copeland said. “They know a lot,” she said. “It should scare some of these people hiding money.”

Copeland said she knows of cases where companies created false invoicing systems and deliberately hid money overseas.

In most cases, people with foreign accounts are unaware they have a reporting responsibility. Even some of their accountants are unaware of the requirement, Copeland said. Some people inherited money from a foreign relative

and left the money in a foreign bank, unaware it needs to be reported to the IRS.

Details on how to come clean with the IRS can be obtained from the IRS site: Penalties are softer for smaller accounts than they are for larger amounts. The IRS will look back eight years for any back taxes and penalties under the 2011 amnesty program.

To be eligible, taxpayers must not already be under criminal investigation or be getting audited by the IRS, Copeland said.

Copeland believes the second amnesty program this year will be the last.

“We”ve been expecting this,” she said.” It gives more certainty to clients we”re advis

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