Offshore Bank Accounts and the Latest IRS Hiring Spree

(June 2009) The IRS is hiring. You need five to ten years accounting experience. Apply online at job search: – and type in Internal Revenue Agent.

If you have an offshore bank account that you “forgot” to tell the IRS about, you might think about being concerned.

Congress is reviewing legislation, supported by the current administration, that could require financial institutions and their U.S. clients to prove that taxes are being paid. The proposed rules would also require (demand) more openness with the IRS. In addition the legislation would raise fines for violator and provide funding for 800 new IRS agents.

Not a big surprise that this type of legislation is being introduced. However, what is surprising is, that a lot more regular taxpayers besides the wealthy are using offshore accounts to avoid paying taxes.

If the current administration gets its way, offshore account holders who “forgot” to include income on their tax returns, may need an attorney to explain the situation by this time next year.

A very simple, yet complicated in some respects, form can help take the burden off your shoulders. It’s call a 1040X – Amend your return.

It’s never too late to tell the IRS that you “forgot” to report income that is stashed away in a bank account that you believe will never be discovered – because you told the offshore bank that you were NOT a US citizen. Yet you gave them a US address or a PO Box address in the US. Or worst, you emergency contact person lives in the US.

You can hire a professional tax person to help you file your 1040X. Although you may want to speak with a Tax Attorney about how to approach the situation without the IRS asking questions that could relate to tax evasion.

Since your “forget” to tell the IRS about the income, where are you going to say it came from? Oh, you “forgot” the $50,000 that you had stashed in a Cayman Island Bank? As the kids say, “Ya, right” Or my spouse put the money in the offshore account and he didn’t know that we had to report it on our tax return!

Like, I suggested, speak to your Tax Attorney and then file the necessary paper work to satisfy the IRS. Not to worry, they will add the penalties and interest, maybe without asking a lot of questions, especially since there was an accounting error during that tax year. (Good help is so hard to find)

1040X the year in question. Be as honest as you can, as soon as you can. Because if given the opportunity, the IRS may be looking for large corporations with big bucks in offshore accounts, your account number could easily show up, especially if some over eager computer programmer, includes a cross reference in the software program that could expose your cover. You can never know exactly what information the U.S. authorities will be privileged to.

Government employees are a lot smarter than we give them credit for. Do the right thing as soon as you can.