Foreign Banks Take Advantage of Tax Amnesty Offer
Foreign Banks Take Advantage of Tax Amnesty Offer: In its latest attempt to tackle the problem of offshore tax evasion, the United States Department of Justice offered Swiss banks that are not currently under criminal investigation the chance to apply for tax amnesty. Banks that chose to accept the offer were given until December 31st to turn over information on any undeclared foreign accounts and to provide information as to how they helped United States citizens hide their foreign assets. A recent report indicated that over one third of the 300 banks that were extended this recent amnesty option have accepted the terms and agreed to cooperate.
Under the terms of this latest tax amnesty program, foreign banks must pay penalties equal to a certain percentage of the value of their undisclosed American accounts in order to avoid prosecution. This percentage is determined by when the undisclosed accounts were opened and is highest for those accounts opened after the 2009 prosecution of UBS. The fines range from 20 percent of the value of undisclosed assets for those accounts opened before August, 2008 up to 50 % for those opened after February, 2009. While the Swiss government is critical of these steeply escalating percentages, it has apparently encouraged banks to cooperate.
The crackdown on offshore tax evasion increased in intensity after the 2009 conviction of UBS, the largest Swiss bank, for hiding over $20 billion dollars in United States assets. As part of this conviction, UBS paid a penalty of over $700 million and turned over in excess of 4000 foreign accounts. In addition, 100 United States taxpayers and financial advisers were criminally prosecuted while over 30,000 others avoided prosecution by disclosing their offshore accounts and paying the back taxes and penalties associated with the disclosures. Since that time, the Unites States Department of Justice has allocated more and more resources to identifying offshore assets and penalizing those institutions and individuals who attempt to hide them. This latest tax amnesty offer is part of that ongoing effort.
If you have questions about the reporting of assets held in foreign accounts or about a tax debt you are unable to pay, our tax settlement professionals are happy to discuss your situation free of charge. For more information about our services, call us today at 877.889.6527 or visit us at www.professionaltaxresolution.com. With over 16 years in the business of resolving tax problems, we have a thorough understanding of both domestic and foreign tax law tax together with the experience to know how to apply that knowledge to your specific financial situation.