Participants in the Internal Revenue Service’s Offshore Voluntary Disclosure Program were more likely to disclose foreign bank accounts from Switzerland than other countries, according to a new government report.
The report, from the Government Accountability Office, found there were 12,889 Report of Foreign Bank and Financial Account forms, also known as FBARs, filed for 2008 by participants in the IRS’s 2009 Offshore Voluntary Disclosure Program, which particularly targeted secret Swiss bank accounts, the GAO noted. Next in line after Switzerland was the United Kingdom. Of the states where taxpayers participated in the Offshore Voluntary Disclosure Program, California was in first place in having the most participants, followed by New York State and then Florida.
“Consistent with IRS's enforcement efforts and the design of the 2009 OVDP, we found that the population of participants was more likely to report offshore accounts in Switzerland than in other locations,” said the report. “Note that each FBAR could report multiple financial accounts and multiple financial institution mailing addresses. In our review of a sample of 2009 OVDP case files, we found that some participants disclosed dozens of offshore accounts with multiple banks and with multiple countries; in other cases, participants disclosed only one account.”
The OVDP offered incentives for taxpayers to disclose their offshore accounts and pay delinquent taxes, interest and penalties. Generally, the program offered somewhat reduced penalties and no risk of criminal prosecution, if eligible taxpayers fully disclosed their previously unreported offshore accounts, and paid taxes due plus interest.
For a March 2013 report, the GAO had identified approximately 10,500 original 2008 tax returns filed by 2009 OVDP participants. For the new report, the GAO reviewed the state listed in the mailing address field of these returns.
To safeguard taxpayer identifies, the GAO did not report the name of any country or territory that appeared 10 or fewer times.
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