Offshore Amnesty Program Reports Success Despite Bad Press

The Offshore Voluntary Compliance Initiative (OVCI) is reporting strong results. The program, designed by the U.S. Treasury Department to encourage wealthy individuals to pay taxes on income hidden in offshore banks, received some unwarranted bad press this week when two U.S. Senators misread a Treasury report and questioned the success of the effort.

Earlier this year the IRS announced that more than 1,200 people had responded to the initiative, offering to report offshore income and pay the taxes, thus avoiding potential civil fraud charges and criminal prosecution. The IRS indicated that it hoped to recover as much as $100 million through the amnesty program.

This week, Senators Charles Grassley (R-IA), chairman of the Senate Finance Committee, and Max Baucus (D-MN) admonished Treasury Secretary John Snow over the performance of the amnesty program. They claimed that, according to a report issued by the Treasury's inspector-general for tax administration, the IRS had so far collected less than $1 million through the amnesty program and that the program had so far cost an estimated $56 million.

The two senators rescinded their remarks yesterday after learning that their staff had misread the inspector-general's report. In a second letter to Treasury Secretary Snow, they admitted, "The IRS's Offshore Voluntary Compliance Initiative has been more successful than previously thought."

Results of the OVCI so far show that more than $75 million has been collected. Also the IRS reports that more than 400 promoters of offshore tax schemes have been identified. More tax revenue is anticipated as the program's October 15 deadline approaches. The cost of the program to date is only approximately $2 million.

You may like these other stories...

IRS must take oath on Lerner emails: judgeMackenzie Weinger of Politico reported on Thursday that a federal judge ordered the IRS to explain under oath how it lost emails connected to Lois Lerner, the ex-IRS official at the...
The Republican-controlled House of Representatives passed a bill on Friday morning that would permanently extend the bonus depreciation tax break for businesses.The measure, HR 4718, which was crafted by Representative Pat...
The Republican-led House of Representatives is expected to pass a bill this week that would permanently extend the bonus depreciation tax break. But don’t expect President Obama to sign it.The Obama administration said...

Upcoming CPE Webinars

Jul 16
Hand off work to others with finesse and success. Kristen Rampe, CPA will share how to ensure delegated work is properly handled from start to finish in this content-rich one hour webinar.
Jul 17
This webcast will cover the preparation of the statement of cash flows and focus on accounting and disclosure policies for other important issues described below.
Jul 23
We can’t deny a great divide exists between the expectations and workplace needs of Baby Boomers and Millennials. To create thriving organizational performance, we need to shift the way in which we groom future leaders.
Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.