Shulman told the New York Times that such a voluntary disclosure programme was unlikely to be as generous as a previous amnesty that ended in October 2009, which flushed out some 15,000 US taxpayers.
An additional 3,000 have come forward since that amnesty ended, Shulman was quoted as saying, adding that the total disclosures would likely surpass 20,000.
Shulman did not tell the paper when the amnesty might be launched or how much money the IRS expected to collect in unpaid tax as a result of it.
Estimates of the number of Americans living abroad range from 5.2 million to more than 7 million, though many of those holding foreign bank accounts are thought to live in the US.
As reported, the Obama administration has made identifying and taxing the undeclared foreign assets of US citizens a key strategy as it attempts to repair its recession-depleted finances. In March, the president signed into law the Foreign Account Tax Compliance Act, which beginning in 2013 will oblige all so-called foreign financial institutions to report on any of their account holders who are US citizens, “or suffer 30% gross withholding on all amounts invested” into the States.
IRS pursuit of UBS ended
Shulman’s revealed the possibility of a new amnesty programme as the IRS announced it was dropping its lengthy legal pursuit of UBS, the Swiss banking giant, during which he also said the tax authority is turning its attention to other major banks known to have American clients.
The IRS’s battle with UBS netted the organisation the names of more than 4,500 clients, though Shulman told the Times that the agency expected to receive “a total of 7,000 UBS client names as a result of the handover and voluntary disclosure initiative”.
The US tax authorities took action against Zurich-based UBS after the bank admitted to helping some of its American customers to evade taxes through the use of offshore accounts. Last year the bank agreed to pay $780m in fines and handed over the data concerning the accounts of some 265 US taxpayers.
If it does go down the tax amnesty route, the US will join such other countries as the UK and Italy in attempting to lure citizens with undeclared offshore accounts into the tax-paying net. A large number of people who are technically American citizens but have dual nationality and live elsewhere are thought to be unaware that they have tax obligations to the US.
This includes children of American citizens who may have been born overseas and who have never set foot in the US, tax experts say.
Numbers suggest under-reporting
Although many Americans feel the US government is unfairly targeting them in its efforts to boost its tax takings, some experts say the statistics appear to suggest many US citizens really are under-reporting their offshore holdings.
Among these experts is London-based US Tax & Financial Services tax director David Treitel, who noted that the number of so-called “FBARs” – reports of foreign bank and financial accounts – filed annually with the US Treasury typically total only around 300,000 to 400,000.
This, he said, compares with his own “back-of-envelope calculation” that the IRS ought to be getting about 3m FBARs a year, when all the US expatriates, US residents with offshore accounts, and green-card holders with offshore accounts are taken into account.
Which is why it is hardly surprising that the US Treasury is beginning to sound “like George W did when he was talking about hunting down terrorists” eight or nine years ago, Treitel added.
“Suddenly you have the IRS talking about hunting down hidden money offshore. That’s very different to three of four years ago, when IRS commissioners talked about ‘helping taxpayers to comply with their obligations’.
"There has been a distinct change in mentality, which says [taxpayers] will now be severely penalised if [they] don’t report these things.”
