The IRS announced the preliminary results of the 2011 Offshore Voluntary Disclosure Program yesterday. The Associated Press disgraces itself with this headline:
Let's meet some cheats:
A Canadian with an American parent who has spent his entire life in Canada, but who is inadvertently out of compliance with U.S. tax laws because he is a U.S. citizen and who faces ruinous penalties if the IRS can get ahold of him.
A 33-year old U.S. expat who moved to France when she was 20, became a French citizen, but who faces ruinous penalties for failing to report her French income and bank accounts to U.S. authorities.
Green Card holders who move to the U.S. for employment but don't realize they are supposed to report all of their financial accounts in their home country to the IRS.
Second-generation Americans who inherited foreign property they never knew about who face-- you guessed it-- ruinous penalties under the FBAR "amnesty."
So there's your "tax cheats," A.P. Yes, there are also some actual tax evaders that have taken advantage of the IRS program, but there are many inadvertent violators trying to get out from under penalties they incurred accidentally with no intent to evade taxes anywhere.
If the A.P. reporter ever accidently leaves a $10 1099 off his 1040, may he face felony tax evasion charges for being a "tax cheat."
The TaxProf has a roundup.
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