Progress on Swiss compliance with U.S. FATCA regulations means time is running out for those committing tax evasion, say tax attorneys.
Tax attorneys report that Switzerland is progressing towards a groundbreaking deal with U.S. authorities by proposing a deal to parliament later this year whereby foreign banks will, in essence perform the role of IRS enforcement agents.
This role is empowered by FATCA, the Foreign Account Compliance Act. By requiring that both individuals report their international financial accounts to the IRS and foreign financial institutions report their American clients, this act primarily aims to combat offshore tax evasion and gather owed federal taxes.
What makes the Swiss move to comply with FATCA regulations so notable is that Switzerland has long been a haven for American citizens who have, for almost a century, sheltered billions of tax dollars in wealth in Swiss banks, where it cannot be tracked or seized by the IRS.
In terms of the deal that will be presented to the Swiss parliament in its summer session, banks that voluntarily choose to participate in this program will share information with the Department of Justice and other U.S authorities on a range of matters, including ‘business relationships concerning U.S persons’ and the bank employees involved in these business transactions. Banks that do not choose to participate in the program will have to protect their employees from investigation.
Switzerland has been under pressure to change their views on banking secrecy as the financial crisis has burdened their famous financial services. In addition to the U.S., Germany, France and the United Kingdom also want similar measures to be undertaken to recoup their tax evasion losses. Should this deal be accepted, it will pave the way to similar demands from other countries, changing the entire face of Swiss banking.
Nervous individuals who for decades have considered Switzerland the ultimate safe haven for offshore tax shelters, are now faced with an urgent need for consultations with qualified international tax attorneys. These individuals are able to provide more information about how to avoid taxes and penalties as they bring these foreign assets into compliance with US Tax Law.
As a firm of experienced international tax attorneys and public accountants, Christopher J Byrne, PLLC, are the right people to talk to about any concerns, queries or advice on foreign tax compliance. Contact us today and speak to one of our experienced tax attorneys.