Published: 2009-12-11

Article provided by Stella Law Firm, P.A.
Visit us at www.craigstellalaw.com

As part of its settlement agreement with the U.S. government, Swiss banking giant UBS agreed in August to turn over 4,450 names of account holders assumed to be hiding assets from the IRS. In late November, the Internal Revenue Service (IRS) announced the criteria UBS will use in determining which accounts must be revealed to the IRS.

Targeted account holders include the following:

• U.S. citizens who hid more than one million Swiss francs in secret bank accounts with USB between 2001 and 2008
• U.S. citizens living in the United States or elsewhere who controlled offshore company accounts between 2001 and 2008
• UBS clients who engaged in "fraudulent behavior" (example: falsifying documents); for these Americans, the reporting threshold is lowered to 250,000 francs
• American customers who earned from their UBS accounts an average of 100,000 francs a year for at least three years

IRS officials said those who responded to the agency's amnesty proposal could have lowered the number of targeted account holders. A reported 9,000 account holders took advantage of the offer, avoiding the possibility of prison sentences and also receiving reduced financial penalties.

Penalties for tax evasion include incarceration in a federal prison for up to five years, plus tax restitution, fines up to $500,000, and a 75 percent civil fraud penalty with interest.

Tax evasion attorneys advise anyone who suspects or knows they will be the subject of an IRS criminal tax investigation to contact a qualified tax law immediately. They say UBS account holders who think they may be reported to the IRS, or anyone else who believes they may be investigated, should not contact the IRS or talk with anyone from the agency before consulting with a tax attorney.

Tax attorneys can in many tax evasion cases negotiate tax debt downward, negotiate an affordable installment agreement, make acceptable offers in compromise, submit a voluntary disclosure and use other defenses on your behalf.