It's no big secret that the United State government has been working diligently to close the lid on suspected American tax evaders. Foreign bank accounts have been the big targets.
The Internal Revenue Service says tax fraud, tax evasion and tax underpayment costs the federal government about $385 billion a year. With an ocean of red ink that deep it should come as no surprise that federal officials in Washington, D.C., and tax collectors at the state level have begun turning to computer software to turn that red ink to black.
When the federal government goes after an individual for tax crimes the process usually occurs in stages. Each stage represents an instance during which opportunities may exist for mitigating the effects and perhaps reducing the chances of a case coming to full prosecution.
Some months ago we wrote about the case of wealthy heiress Mary Estelle Curran and how she had become a target of the Internal Revenue Service because of funds held in foreign bank accounts. It’s a story that we suspect a lot of our readers in the Washington, D.C., area found intriguing.
That wealthy people employ tax havens in efforts to protect their wealth is not particularly shocking. But in recent weeks, it's become a little clearer just how prevalent the use of the havens is and how interconnected they appear to be.
As long as Congress is undertaking efforts to reform the U.S. tax code, why not repeal the Foreign Account Tax Compliance Act. That's the suggestion that's being made by the group American Citizens Abroad. The recommendation addressing this particular tax controversy was made in the form of a statement sent to Washington, D.C., this week to selected members of the House Ways and Means Committee.
Detroit - The man charged with fixing Detroit's faltering finances has been hit with four liens in four years from the state of Maryland for unpaid taxes, records show.
The top Democrat on the House Oversight and Government Reform Committee says a measure passed by the panel on a voice vote this week defies logic. If the bill becomes law, federal workers who are "seriously delinquent" on paying their taxes and under liens for evading taxes could find themselves out of a job. Candidates for federal positions who are delinquent would be eliminated from consideration.
It might seem counterintuitive, but the government doesn't care how you make your money when it comes to taxes. However you earn your income, the Internal Revenue Service wants it reported so that appropriate taxes can be collected. Filing instructions make it clear that income, even from illegal activities, must be recorded and reported.
We've written a bit in recent posts about the Internal Revenue Services efforts to close the loop on U.S. citizens they suspect of using foreign banks to hide wealth and income from tax liability. Swiss banks and the accounts they hold have garnered much of the limelight, but banks all around the world are under scrutiny as officials in Washington, D.C., try to bring some black to the red that washes over the treasury.