(NEWSMAX) -- The Internal Revenue Service is ending amnesty for Americans’ overseas financial accounts.
The IRS will end its program allowing American tax cheats with secret offshore accounts to confess them and avoid prison, the Wall street Journal reported.
In a statement, the IRS said it’s closing the program because of declining demand, The Wall Street Journal reported
But the agency vowed to keep pursuing people hiding money offshore and said it will offer them another route to compliance, the Journal explained.
Known as the Offshore Voluntary Disclosure Program (OVDP), taxpayers will no longer be allowed to confess their secret accounts and pay a heavy fine in exchange for potential protection from criminal liability, Fox Business Network reported.
Under OVDP, the penalty could reach as high as 50 percent of what was being shielded overseas, FBN reported.
Since 2009, more than 56,000 taxpayers have voluntarily disclosed their foreign accounts, paying $11.1 billion in back taxes, interest and penalties, CNBC reported. Only 600 people disclosed accounts in 2017, Fox Business Network explained.
“Taxpayers have had several years to come into compliance with U.S. tax laws under this program,” said Acting IRS Commissioner David Kautter. “All along, we have been clear that we would close the program at the appropriate time, and we have reached that point. Those who still wish to come forward have time to do so.”
Before 2008, an American citizen could often walk into a Swiss bank, deposit millions of dollars, and walk out confident that the funds were safe and hidden from Uncle Sam, Mark Matthews, a lawyer with Caplin & Drysdale who formerly headed the IRS’s criminal division, told WSJ.com
Now, he says, “Americans hiding money abroad have to go to small islands with sketchy advisers and less reliable financial systems.”
However, Americans should take to heart the IRS vow to keep pursuing secret offshore accounts, says Bryan Skarlatos, a criminal tax lawyer with Kostelanetz & Fink who has handled more than 1,500 offshore disclosures to the IRS.
“More than ever, there’s no place to hide,” he told WSJ.com.
Skarlatos explained the Justice Department is now better equipped to fight tax evasion and money laundering than 10 years ago. Among such weapons are the Fatca law, which requires foreign firms to report information on American account holders.