Nervous Americans scattered across the world are hurrying to tax advisers and lawyers ahead of the IRS' offshore amnesty deadline, according to reports.
Many US citizens are considering checking and paying any outstanding tax using the IRS' Offshore Account Settlement Initiative, which ends 23 September to avoid penalties dished out in a future tax evader hunt.
According to the FT, some US Lawyers have experienced a tenfold surge in requests for help filing Report of Foreign Bank and Financial Accounts (FBAR) of offshore assets.
Advisers believe American expats living in low-tax jurisdictions such as Hong Kong and Singapore are the most ruffled, as they are assumed to owe the largest amount of tax to the IRS.
The amnesty move follows the Department of Justice's deal with UBS last month, which forced Swiss authorities to surrender over 4,450 names of wealthy American clients of the bank to the IRS.
Unless clients check they owe the US government nothing, UBS customers have no idea whether the IRS will come after them at a later date.
Clients who opt into the amnesty will see penalties capped at 20% of the total undeclared amount, as well as a 25% accuracy penalty.
IRS commissioner Douglas Schulman, has warned the deadline will not be extended.
It is estimated about 60,000 US expats live in Hong Kong, while 15,000 are domiciled in Singapore and 8,000 in Malaysia, indicating the IRS's clawback of tax could prove fairly lucrative.
Furthermore, the three jurisdictions may also have to disclose US account holders to the American authorities under the terms of tax information exchange agreements (TIEAs).
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