Americans who face being named in the Panama Papers have been told to come clean before any illegal activity is discovered by officials.

More than 200 people with U.S. addresses have so far been identified by authorities combing the Mossack Fonseca documents, which were leaked earlier this month.

The Internal Revenue Service (IRS) has now advised anyone using offshore accounts to contact them as the investigation gains momentum.

Americans who face being named in the Panama Papers have been told to come clean before any illegal activity is discovered by officials. Above, a policeman stands guard outside the Mossack Fonseca law firm officers during a raid last week

In a statement given to NBC News, the service said: 'People hiding assets offshore should recognize the continued changes and progress in the international tax arena.

'More than ever, their best option remains to come forward voluntarily and participate in the IRS Offshore Voluntary Disclosure Program.'

It comes after experts revealed the reason for the low number of Americans involved - in comparison with other countries - might be because shell companies are being formed under authorities' noses in Wyoming, Delaware or Nevada. This means residents do not need to go to Panama.

Shima Baradaran Baughman, a professor at the University of Utah, told Fusion that Americans 'have no need to go to Panama to form a shell company to use for illicit activities'.

She added: 'It [the leak] should make Americans look internally to see what kinds of corporate illegalities we are allowing within our own borders.'

James Henry, a economist, agreed, adding that the U.S. has an 'onshore haven industry.. that is as secretive as anywhere'.

More than 200 residents have so far been named in the Mossack Fonseca documents, which were leaked earlier this month. Above, an officer keeps an eye out during last week's raid

His comments came as other experts confirmed it would take months for journalists to trawl through the 11.5million documents, meaning it will be a while before the number of Americans involved can be confirmed.

Jack Blum, a Washington lawyer and offshore activity expert, told Fusion is was going to 'take some time' due to the enormity of the database.

He added that he expected more Americans to show up when stock fraud and manipulations are examined, as well as hedge fund operations.

Other reports have suggested thousands of Americans could be involved.

The leaked documents from one of Panama's most secretive law firms emerged after hundreds of journalists from across the world spent months interpreting the data.

Sigmunder David Gunlaugsson became the first victim of the leak as he sensationally resigned from his position as Prime Minister of Iceland.

His resignation came after the documents appeared to show he and his wife set up a company in the British Virgin Islands to hide millions of pounds.