From July 1, 2010 through October 29, 2010, the Minnesota Department of Revenue will forgive penalties for offshore accounts and foreign entities used to evade taxes. The penalties will be waived for qualified taxpayers who disclose their offshore accounts and entities to the state through the Minnesota Voluntary Disclosure Program.
Why You Should Participate
According to the Minnesota Department of Revenue, you should make a voluntary disclosure to clear your tax records. By making a voluntary disclosure you eliminate the risk of criminal prosecution and avoid tax penalties.
The IRS has recently partnered with the Swiss government to release the names of thousands of United States residents suspected of using foreign bank accounts to avoid taxes. The Minnesota Department of Revenue claims that because of information sharing with the IRS that they will ultimately obtain the names of the Minnesota taxpayers engaged in these types of activities.
What Happens if You Don't Participate
According to the Department of Revenue, without participation in this program the taxpayer could be subject to charges such as fraud, substantial understatement, negligence, failure to file, and failure to pay in addition to penalties and interest on unpaid taxes.
Before You Decide
Because this involves a possible criminal offense, you should consult with a lawyer familiar with tax law before making any disclosures or deciding whether or not to participate.
Where to Get Information
The Department of Revenue Offshore Voluntary Disclosure website lists frequently asked questions about the program and gives two individuals to contact for more information: Andy Rinderknecht at 651-556-6963 (Form 1040 filers) or Bill Lindsay at 651-556-6857 (all other filers).