1,200 concede they've used foreign accounts to skip taxes

WASHINGTON -- More than 1,200 people have stepped forward to reveal they used offshore accounts or credit cards to avoid paying more than $100 million in taxes, the Internal Revenue Service said Thursday.

Those who turned themselves in avoided prosecution and some penalties, and they led the IRS to 80 new promoters who will be pursued for marketing and selling illegal offshore accounts.

Investigators have spent months tracing the identities of people who hold thousands of Visa, MasterCard and American Express cards issued by banks in offshore tax havens. The records were obtained through previous court orders in an attempt to pierce secrecy laws that protect these bank accounts.

After obtaining the records, the IRS established the voluntary compliance program to flush out promoters and encourage taxpayers to come clean.

After reviewing initial cases, at least $50 million in uncollected taxes have been identified.

Those who applied for the partial amnesty program had to provide full details of the promoter who arranged the offshore accounts. About 240 applicants claimed the offshore promoters had scammed them.

The IRS will pursue criminal and civil penalties against those who did not turn themselves in.

The Treasury Department and IRS also are pursuing corporate tax shelters.