Will help it's citizens overseas and dual citizens, as well as those with foreign retirement plans.
The American IRS has a plan designed to help U.S. citizens who are living in other countries.
"Today we are announcing a series of common-sense steps to help U.S. citizens abroad get current with their tax obligations and resolve pension issues," said IRS Commissioner Doug Shulman.
Shulman announced the IRS will provide a new option to help some U.S. citizens, and others residing abroad who haven’t been filing tax returns and provide them a chance to catch up with their tax filing obligations if they owe little or no back taxes. The new procedure will go into effect on Sept. 1, 2012.
Those Americans living overseas have in some cases just now come to realize their obligations with filing tax forms and Reports of Foreign Bank and Financial Accounts (FBARs) and want to do the right thing with the IRS.
IRS has come up with a plan that is good for the low risk taxpayer overseas and usually involves taxpayers owing less than $1,500.00 for any covered years.
There is also help for those with foreign retirement plans.
Taxpayers under this plan will have to file delinquent tax returns with related info returns for the past three years.
They will also have to file delinquent FBARs for the past six years.
Input from the tax returns filed by tax-payers with a higher income risk could be audited and will have a more thorough review.
The audit could cover more than 3 years.
There is an excess of $5,000,000,000.00 ($5 billion dollars) income from the program so far.
They have closed one of the prior loopholes already used by offshore account holders that were Americans.
Here's the scoop on that right from the IRS:
"Under existing law, if a taxpayer challenges in a foreign court the disclosure of tax information by that government, the taxpayer is required to notify the U.S. Justice Department of the appeal."
"If the taxpayer fails to comply with this law and does not notify the U.S. Justice Department of the foreign appeal, the taxpayer will no longer be eligible for the Offshore Voluntary Disclosure Program (OVDP). The IRS also put taxpayers on notice that their eligibility for OVDP could be terminated once the U.S. government has taken action in connection with their specific financial institution."
Roger Chartier - The Author