The formal IRS/Department of Justice (DOJ) Swiss Bank Program has concluded with 80 Swiss banks coming forward. The banks agreed to provide information about personnel, depositors and advisors who were participated in or assisted U.S. taxpayers in offshore tax evasion. In addition to disclosure and cooperation with investigations each of the banks paid substantial penalties. In exchange for the disclosures, cooperation and penalties, the banks received Non-prosecution agreements. But let there be no mistake, the offshore tax program is far from over. There is substantial political pressure on the IRS and DOJ and exemplified by the recent statement of Senator John McCain.
U.S. persons, including pemanent resident aliens and dual nationals should note that the Lifting of U.S. Sanctions on Itran under the Joint Comprehensive Plan of Action does not lift all sanctions. The following is a link to acomprehensive set of Freqnently Asked Questions (FAQ's): https://www.treasury.gov/resource-center/sanctions/Programs/Documents/jcpoa_faqs.pdf
The Department of Justice and the IRS are now mining the wealth of data obtained through settlements (Non-Prosecution Agreements) with almost 100 Swiss banks. The search through the data is methodical.
The IRS recently published published an internal guideance on who must report interests in foreign corporations and the penalties for non-compliance. The timing of the guideance is important as the first "information exchange" and "information reporting" under the Foreign Account Tax Compliance Act, "FATCA" occurred September 30,2015. The IRS and Justice Deptartment will now be able to cross check the data provided through the infomation exchanges with filed returns and initiate civil examans and in some cases criminal investigations against non-filers. It is no longer a matter of if non-filers will be discovered, but when.
The following Notice from the IRS reiterates the enforcement focus on offshore accounts. Anyone with an unreported offshore account needs to consult counsel and discuss their compliance options under the "attorney-client" privilege.
At a recent tax conference a senior Justice Department official reaffirmed thte commitment of the U.S. Department of Justice to continue offshore enforcement efforts.
It's Here; The Automatic Exchange of Information Under FATCA Began September 30th
There are now 50 foreign financial institutions on the IRS list of "bad banks" The list is published at the following link:
It may be a commone misunderstanding that a U.S. citizen or permanent resident (Green Card holder) can give up their citizenship or surrender their Green Card and then as a non-U.S. taxpayer make gifts or pass their estate to U.S. taxpayers free of estate and gift tax. The IRS recognized this loophole and has proposed a new Regulation designed to tax the recipient of the gifts or inheritances from "covered expatriates" at maximum estate and gift tax rates.