According to published reports, German and French tax authorities recently executed searches of the homes and offices of customers and employees of two of the largest Swiss banks. The searches are believed to be part of a crackdown on the use of Swiss banks to commit tax evasion.
According to Reuters, approximately 5,000 German clients of a large Swiss bank are being investigated for tax evasion. It appears that German authorities targeted bank customers whose names the German government bought from an informant at one of the banks in 2010. Meanwhile, French authorities raided the offices of another large Swiss bank in Lyon, Bordeaux, and Strasbourg. Several high-ranking Swiss bank employees in Strasbourg had their private homes searched.
With the German and French searches, the drumbeat of the world-wide crackdown on offshore tax evasion continues. The IRS continues to mine data that it has received from over 33,000 taxpayers whose voluntary disclosures contain informant-like details. Additionally, FATCA looms on the horizon for U.S. taxpayers who have not disclosed their foreign accounts. “If a U.S. taxpayer has unreported income from domestic sources or from off-shore accounts, they should seriously consider the IRS Offshore Voluntary Disclosure Program,” says Jim Mastracchio, Co-Chair of the Firm’s National Tax Controversy Practice. Jay Nanavati, a former DOJ Tax Division attorney, added, “U.S. taxpayers who are dual citizens or dual residents should not hesitate in seeking U.S. tax counsel with respect to their worldwide investments.” Mr. Mastracchio and Mr. Nanavati, resident in Washington, D.C., routinely advise U.S. taxpayers regarding off-shore account disclosures.
