The U.S. tax laws require all citizens and residents of the United States to disclose offshore financial assets, like bank accounts, on their tax returns and pay tax on income generated by those assets. For decades, however, many individuals were able to skirt these laws by hiding assets in tax havens around the globe, where their accounts were protected by stringent bank secrecy laws and governments unwilling to cooperate with the United States. In 2009, the Internal Revenue Service launched an aggressive crackdown on these practices, by designating offshore tax evasion a key enforcement priority and by successfully lobbying Congress to pass new laws strengthening the IRS’s powers to obtain information about the offshore activities of U.S. taxpayers. The result of these efforts is that the U.S. tax laws now require more disclosure than ever of the offshore activities of U.S. taxpayers, and that compliance by taxpayers is substantially better than in the past. This new era of tax transparency affords significant benefits to family law practitioners in search of offshore assets, and U.S. tax returns can now provide a useful roadmap for uncovering assets outside of the United States.
Premium Content For:
- Family Law Section