Failing to disclose bank accounts and earnings to the Internal Revenue Service (IRS) is generally a practice that can bring legal difficulties, particularly in recent years when the focus has been placed on investigating offshore accounts. The IRS has vast resources at its disposal and does not hesitate to use them in its effort to collect what is owed to the government. The IRS, when aided by banks, is an even more formidable foe.
In the latest case stemming from UBS' admission of aiding tax evaders, a taxpayer was put on probation for three years, ordered to pay the IRS more than $96,000 in civil liability for failing to report money in offshore accounts, failing to report interest income on those accounts and allegedly filing false tax documents from 2000-2008.
In 2009, UBS admitted that it had been aiding U.S. taxpayers in hiding money from the IRS in foreign accounts. As part of a deferred prosecution agreement, UBS agreed to pay $780 million in fines and restitution, agreed to provide the IRS with the names and account information of its U.S. clients, and to end its practice of providing U.S. customers with undeclared accounts.
The IRS is continuing its efforts to recover unpaid taxes and prosecute those with undisclosed accounts. Even though the IRS' prosecution efforts have been aided by UBS, the IRS is offering a program for those that wish to voluntarily pay taxes on their unreported income.
If you have unreported income and unpaid taxes, speak with an attorney to discuss how to report this information while still protecting your rights.