IRS To Waive Penalties For Some American Overseas Accounts

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The Internal Revenue Service is offering to waive steep penalties for Americans living abroad who haven't been paying their U.S. taxes. (Photo by Win McNamee/Getty Images)

The Internal Revenue Service is offering to waive steep penalties for Americans living abroad who haven’t been paying their U.S. taxes. (Photo by Win McNamee/Getty Images)

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WASHINGTON (AP) — The Internal Revenue Service is offering to waive steep penalties for Americans living abroad who haven’t been paying their U.S. taxes.

But there is a catch: You have to be able to show that you didn’t evade U.S. taxes on purpose.

American citizens living abroad are required to file U.S. tax returns, even if they keep all their money overseas. Similarly, U.S. citizens living in the United States are required to tell the IRS about any accounts they have in foreign banks.

The penalties for not reporting these accounts are stiff. If there is more than $10,000 in an unreported account, the IRS can impose penalties of $100,000 — more if the accounts are really big.

(© Copyright 2014 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)

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