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79 Year Old Widow Faces Prison for Offshore Accounts

On January 8, 2013, the Department of Justice announced that Mary Estelle Curran of Palm Beach, Florida pleaded guilty for failing to file tax returns for tax year 2006 and 2007. Ms. Curran has agreed to pay a civil penalty of over $21 million, a tax liability of $667,716 and faces a potential maximum prison term of six years. Her plea agreement limits her prison sentence to 30-37 months.

A 79-year old widow, Mrs. Curran was prevented from entering the IRS's 2009 Offshore Voluntary Disclosure program because the Department of Justice had already received information about her accounts from UBS Switzerland. Her husband of more than 40 years, Mortimer Curran, passed away in 2000 - leaving her with upwards of $43 million in undeclared offshore accounts. The accounts, in the name of different nominee foreign entities, were kept at bank accounts in Switzerland and Liechtenstein and controlled by Mr. Curran until he died. Mrs. Curran has a high school education, no background whatsoever in finance, and had no idea how much money was in the accounts when her husband passed away.

Over 38,000 taxpayers have come forward as part of the IRS's 2009, 2011, and 2012 Offshore Voluntary Disclosure programs - resulting in millions of dollars in back taxes and civil penalties for the U.S. Treasury. Mrs. Curran's story is a lesson-to-be learned for taxpayers in a similar situation: disclose non-compliance before the U.S. government finds out about it or the consequences will be unpredictable and potentially disastrous. With the implementation of the Foreign Account Tax Compliance Act agreements between the U.S. and countries such as Switzerland, Great Britain, and Mexico, the potential that the U.S. will discover a U.S. taxpayer's foreign bank account before it is disclosed increases exponentially.

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