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As the year 2014 quickly comes up on the calendar, we have to ask ourselves whether playing Russian roulette with a foreign bank account is still exciting or just too risky. 

There has been a lot of talk about the U.S. not being able to obtain overseas financial and banking information on its citizens.   Then the conversation rolled over to whether the European countries’ taxing authorities could get U.S. financial and bank information on its citizens banking in the U.S.   On 8 February 2012, HM Treasury (UK) announced that it had agreed on a government-to-government approach to improving international tax compliance and implementing the US Foreign Account Tax Compliance Act (FATCA), an act designed to tackle international cross-border tax evasion.  FATCA, scheduled to come into force from 1 January 2014, imposes reporting requirements on Foreign Financial Institutions (FFIs) with regards to certain US accounts. In effect, the law obliges all FFIs to become information gathering agents of the US Internal Revenue Service (IRS) by threatening an FFI’s own US source income and sale proceeds with a 30% withholding tax. The broad definition of FFI in the act means that its introduction will not only

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An additional 9 European banks are under investigation for suspicion of helping wealthy U.S. citizens avoid U.S. reporting and taxation.

German, French, Luxemburg, Lichtenstein, Spanish, Dutch and English banks are also becoming the brunt of investigations from their own governments for relinquishing private tax data and information that may lead to their citizens avoiding national taxation. Much of this information may find its way to the U.S. Treasury to assist them in investigating the additional 9 European banks. This information may also allow the U.S. Treasury to “expand” the number of banks from 10 to a much higher number, including private banks and corresponding banks. This expansion news has sent waves of concern into the banking world as well as their customers who had relied to the confusion of European banking laws between the EU countries combined with the protective mandates and legislation within each banking country.

On September 21, 2011, Chancellor Angela Merkel’s government signed an agreement with Switzerland that seeks to end a dispute over tax evasion, setting up a clash with German opposition lawmakers who threatened to block the measure.

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The U.S. Treasury announced the current results of the Tax Amnesty that was offered for 2011 with the extended deadline of September 9, 2011.

A total of more than 30-thousand individuals have come forward under the amnesty programs for 2009 and 2011. The amount of additional revenue collected, on the 2009 amnesty program exceeded $2,200,000,000. Of the 2009 applications for amnesty, about 80% of the cases have been “closed.” It is unclear what Washington means by the word “closed” but it may include applicants that were later found as not qualifying for the amnesty program.

For the 2011 amnesty program, the IRS has disclosed that more than 12,000 individuals applied for the tax amnesty. It is staggering that even with less than three weeks into the deadline for the 2011 amnesty, the IRS has announced that $500,000,000 has already been collected from the 12,000 applicants without the soon-to-be assessment of massive penalties that will fall at approximately 50% of the tax assessment which will place the 2011 amnesty at nearly the $1 billion mark in just three weeks after the deadline. I doubt that the $500 million represents any substantial percentage of the 12,000 applicants since the period of time to work a particular complicated taxpayer

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Update: Tax Amnesty for Non-Reporting of Foreign Bank Accounts

As you may recall from my last in a series of articles on tax amnesty, U.S. taxpayers who failed to file disclosure forms were alerted by the U.S. Treasury on September 21, 2009 of a one-time extension of time to October 15, 2009 to comply with the special voluntary disclosure requirements of the Internal Revenue Service for Americans with unreported income from bank accounts situated outside the United States. As a result, after the deadline passed, many amnesty filings were made with the U.S. Treasury.

According to the latest information from the U.S. Treasury, more than 15,000 amnesty filings were made on or before the 15th day of October 2009. The IRS and the IRS Commissioner, Douglas Shulman, disclosed that even after the above deadline, an additional 3,000 taxpayers came forward to be in compliance with America’s tax laws in relation to foreign bank accounts.   The total amount of tax, interest and penalties assessed and collected were so significant to the Treasury that another voluntary tax amnesty program and period would be offered with less favorable terms.
IRS Commissioner Shulman stated:

“As I’ve said all along, the

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