The Internal Revenue Service is mighty pleased about its foreign-account amnesty program, in which it promised not to penalize holders of foreign bank accounts and the like as long as they 'fessed up and paid the taxes due on the money.

Since 2009, when the amnesty program began, the IRS has taken in more than $7 billion from more than 50,000 former scofflaws. Better yet, the agency is checking the names of banks where the assets were hidden and going after them—with good results.

Now, if you have legal foreign assets—more than $100,000 at the end of December or $150,000 at any time during the previous year—the IRS expects that you will file Form 8938 with your tax return. (Note: the threshold for singles is half that, and lower yet for taxpayers who live abroad.) And the penalty for failing to file is $10,000!

The IRS is aware that some estate executors have failed to file this form or mention the assets and the income they earned. In that case, the normal statute of limitations is lengthened and the agency has a full three years after it discovers the hidden assets to go after the estate for the taxes owed.

For nearly 30 years, Mike Nickerson has owned and managed a small, full-service accounting practice in the Midcoast. He holds a bachelor's degree in accounting from University of Southern Main and a master's degree in financial planning from Bentley University. He is a past board member and president of the Maine Society of Certified Public Accountants and currently serves on the Maine Board of Accountancy.

An aged rock musician, Nickerson now finds musical enjoyment playing upright and electric bass in a variety of bands spanning folk to jazz music genres. He and his wife have three grown children, and they enjoy their free time hiking, kayaking, golfing, bicycling and motorcycling.

nickersonpa.com