The IRS is currently offering an amnesty program through August 31, 2011 for past due reporting regarding offshore accounts. An initial amnesty program closed on October 15, 2009, and many individuals simply did not learn of its availability until it was too late.

The new amnesty program gives all of those who were unable to participate in the first program a second chance to report the existence of foreigh financial accounts. Given the risk of criminal prosecution and the harsh penalties imposed if the IRS learns of foreign accounts, there is increased motivation to participate in this program before it expires. The opportunity to avoid criminal prosecution resulting from an undeclared offshore account should serve as a major incentive to participate. Amnesty will also reduce the civil penalties from 50% of the value of the account each year to a single penalty of 25% of the highest value of the account over the past eight years.