September 20, 2009 - Phil Hodgen

Jumping off the amnesty bus if you want to

This is a recurring question.  If you start down the amnesty path but you don’t like the outcome, can you be forced to accept the 20% of high balance as your penalty?

Survey says . . . NO!

Here’s the way the IRS says it in the voluntary disclosure FAQ:

Q34. If, after making a voluntary disclosure, a taxpayer disagrees with the 20 percent offshore penalty, what can the taxpayer do?

A34. If any part of the penalty structure is unacceptable to a taxpayer, that case will follow the standard audit process. All relevant years and issues will be subject to a complete examination. At the conclusion of the examination, all applicable penalties (including information return and FBAR penalties) will be imposed. Those penalties could be substantially greater than the 20 percent penalty. If the case is unagreed, the taxpayer will have recourse to Appeals.

Voluntary Disclosure