This comes from the IRS - It refers to their efforts to go after US citizens
with offshore accounts. For the record, that applies to every US citizen
living in Canada with a "CANADIAN" Bank Account Vis, MC, AMEX, RRSP, RRIF,
etc.
Pay attention
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IR-2003-95, July 30, 2003
Offshore Compliance Program Shows Strong Results
WASHINGTON - The Internal Revenue Service continues to see a strong
response to its Offshore Voluntary Compliance Initiative (OVCI), with more
than $75 million in taxes collected so far. In addition, more than 400
offshore promoters were identified.
Taxpayers had until April 15, 2003, to apply for OVCI. The program was
designed to bring taxpayers who used offshore payment cards or other
offshore financial arrangements to hide income back into compliance with
U.S. tax laws.
In all, the IRS received OVCI applications from 1,299 taxpayers from
nearly every state and from 48 other countries. The IRS is still
processing many of these applications. However, current results show the
initiative's effectiveness:
. Taxpayers have already paid more than $75 million in taxes to the
program.
. The $75 million figure will continue to grow because most taxpayers
accepted into the program have until Oct. 15 to amend their tax returns
and pay back taxes.
. OVCI applicants identified more than 400 offshore promoters. Of these,
214 promoters were previously unknown to the IRS, which helps the agency's
efforts to counter offshore tax evasion.
. While the program has led to $75 million in taxes collected, the cost of
the OVCI program is approximately $2 million to date.
Applicants to OVCI had to provide full details on the person or persons
who promoted the offshore arrangements. Eligible taxpayers could avoid
criminal prosecution and certain penalties but would still have to pay
back taxes, interest and some penalties.
People from all walks of life applied for the program, including lawyers,
dentists, business executives, estate heirs and numerous other
occupations.
OVCI is just one part of an on-going, multi-pronged effort by the IRS to
counter offshore tax evasion.
A related, but separate component of the effort is the Offshore Credit
Card Program (OCCP). This program stems from the John Doe summons
investigation. Since October 2000, the IRS has issued a series of
summonses to a variety of financial and commercial businesses to obtain
information on U.S. residents who held credit, debit or other payment
cards issued by offshore banks.
Investigators have been using records from the John Doe summonses to trace
the identities of people whose use of these payment cards may be related
to hiding taxable income.
The results of OCCP have also been promising. To date, OCCP has produced
the following results:
. About 2,800 tax returns are under audit or have already been completed.
That number will continue to grow.
. The vast majority of these taxpayers remain in the audit process, and
taxes have not yet been assessed on these cases. So far, more than $3
million in taxes has been assessed. This number will grow in the future.
. Dozens of cases have already been referred to Criminal Investigation for
possible action.
In the weeks and months ahead, the IRS will continue working on the OVCI
and OCCP programs. As part of this process, the IRS will continue its work
to identify and pursue civil and/or criminal penalties against those
engaged in improper offshore transactions.
"We have a multi-pronged approach on offshore tax evasion, and we will
continue to aggressively pursue this issue," said Bob Wenzel, IRS Deputy
Commissioner for Services and Enforcement. "Our continuing efforts send a
strong signal to offshore tax evaders and others considering hiding their
money overseas."
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The following is also a IRS announcement. The IRS expects 3,000,000 2688's
to be filed by August 15th. Our office will file over 50.
IR-2003-96, July 31, 2003
8.5 Million Who Filed for Extensions Approach Aug. 15 Tax Deadline
WASHINGTON - Most taxpayers already have filed their tax year 2002 federal
income tax returns. But for more than 8.5 million taxpayers, the deadline
is August 15 if they opted for the automatic extension of time to file by
completing Form 4868 by April 15.
The Internal Revenue Service reminds taxpayers with extensions to file
their returns by August 15 to avoid the late filing penalty, which is 5
percent per month of the unpaid tax. Help may be available, however, for
people who cannot file by August 15.
Taxpayers with special circumstances, such as a hardship, that prevent
them from preparing and filing their tax forms by August 15 may request an
additional two-month extension by completing Form 2688 that will give them
until October 15 to file their income tax returns. These taxpayers will be
granted an extension of time to file even if they cannot send in payment
of outstanding 2002 taxes with the extension request.
Taxpayers granted the additional time to file will not be penalized for
late payment of tax if they pay the balance of their 2002 tax when they
file the tax return by October 15 provided 90 percent of their total tax
was paid by April 15.
To request the additional time to file, taxpayers must file Form 2688 with
the IRS by August 15. Form 2688 is available on the IRS Web site, IRS.gov.
The IRS will advise filers in writing whether or not their requests are
granted.
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