The due date for participation in the IRS’s partial amnesty program is October 15, 2009. That means there is just one week remaining for UBS investors to come clean.
Generally, by doing so the taxpayer will be able to avoid criminal prosecution and limit the FBAR penalties to 20% of the highest balance held in the UBS account during the past 6 years. The taxpayer will have to amend his or her tax returns to report any unreported income earned during the six year period. Interest and penalties (in addition to the FBAR penalty) will be assessed on the understatement.
If you are a UBS investor, you should have received a letter from it advising you of the procedure for filing for protection under the VDP.
Yesterday a client and I called the help number shown on the notice and obtained the following information directly from a UBS official charged with the responsibility to advise UBS’s American customers regarding the IRS disclosure process:
- It is likely that UBS will disclose more than the estimated 5,000 U.S. investor names originally predicted.
- Nobody knows what the final number of disclosed investor names will be.
- Taxpayers can file a bare bones application for participation in the VDP and follow that up with the filing of the appropriate amended returns and delinquent FBARs.
- U.S. Taxpayers can challenge the disclosure in Swiss Court. These challenges are based on Swiss privacy laws and will be difficult and expensive to win.
- Switzerland and the U.S. have agreed on specific criteria to be used to determine which investors names will be disclosed to the IRS. The criteria will not be disclosed to the public.
My Advice: You should file for protection under the Voluntary Disclosure Program even if you don’t have the necessary information to prepare the delinquent FBAR and amended tax returns. The important thing is that you get into the amnesty program by filing before the October 15th deadline passes. There won’t be any more extensions.
Related Posts:
- Tax Crimes: UBS Investor Criminal Cases Under Way
- Offshore Tax: IRS Issues FAQs on Voluntary Disclosure
- IRS Urges Foreign Bank Account Holders to Come Forward Voluntarily
2 responses so far ↓
1 WARNING: Last Day to File For Amnesty Protection // Oct 15, 2009 at 12:03 am
[...] IRS Amnesty Deadline is October 15th: UBS Says More than 5,000 US Investor Names to be Disclosed [...]
2 Swiss Parliament Ratifies U.S. Disclosure Agreement; Too Late for Voluntary Disclosure Program // Jun 18, 2010 at 2:32 am
[...] [...]
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