lansbury

This could make it interesting for those who don't declare their UK cash on the IRS returns. Once the US has it fingers in the pie who knows what they will do with the information.

http://news.bbc.co.uk/2/hi/world/europe/10552630.stm

sir_eccles

Surely it is only a worry if you are earning significant amounts of interest. You don't get a 1040 from US banks unless interest earned is over $10.

lansbury

If you have more than a certain amount $10000 in an overseas bank you have to tell the IRS you have the account. Doesn't matter what interest it earns or not. Wonder how many don't do that.

sir_eccles

I don't think I have to worry about that then

Jerseygirl

Just to clarify...if the aggregate amount of all overseas accounts is $10K or more in any given year you must notify the Treasury Dept...this includes overseas pension funds.

The penalty is extremely severe for failure to declare the accounts.

It's got nothing to do with the interest earned....even if you're not gaining interest the accounts must be declared.

celticgrid

It strikes me as data that they are collecting to simply file, as the amount to be reported for each account is the maximum balance during the year. So if you have, say, 11,000 and move it around a bit to get better rates or whatever, the total you end up reporting can be a lot larger than the actual money you have.

Jerseygirl

I don't think so. I don't know the details because our accountant handles ours but I doubt that will happen. I believe it's more for money laundering and fraud than anything else.

lansbury

Thanks for the correction Our CPA only reports the account with the excess of $10K in it, he doesn't report our checking account.

I'll point this out to him because he told me his company gets fined $5K a day if they fail to make sure their clients are aware of the reporting requirements.

Titchski

So the £26.15 in my hidden NatWest Current Account is safe then?

celticgrid

I'm unclear on what you doubt will happen....?

If you mean the inflated reporting, it does happen. I do my own paperwork and what is required is the maximum balance for each account during the year. Therefore any money moved between accounts may be included twice (or more) in the figures you report. I've seen it happen on my own paperwork.

Thus I am somewhat puzzled as to how the authorities can use the information for anything proactively other than very subjective scrutiny. The information would, however, prove useful as the basis for undertaking some sort of reactive investigation.

Steerpike

so the #20,000 I may have in a pension fund (and simply can't be bothered to declare) is an issue then!?

How do they tie it to me - SSN ? That is - how do they know that I, in the US, am the person owning the account in the UK?

Bob

At the moment, they don't, but if they do find out, the penalty is pretty steep.

Jerseygirl

I have no idea...all I know is that we have an accountant from the big 3 accountancy firms who specialises in international taxation to prepare our taxes every year. My husband (who is an ex-partner in the company) is meticulous down to the last penny.

dreamercon

US only gets access to SWIFT data about transfers, not data about account balances. Moreover, swift will transfer encrypted data to the US in bulk - the volume is so great that it cannot currently narrow it down to individual transactions. US investigators will need to convince Europol to conduct specific searches, and for that they need to have suspicions of terrorism activity, not just tax evasion.

Michael

I don't think that the IRS is interested in pursuing the small time tax evader but wants the big time tax evader that have deposits in countries like Switzerland. When the US got an agreement with the Swiss government to look at 4,450 US accounts in UBS, it struck terror for a lot of rich Americans (up to 50,000 accounts were requested).

http://www.washingtonpost.com/wp-dyn...061703754.html

After the US reached an agreement with the Swiss government, over 14,700 taxpayers disclosed billions in foreign accounts to the IRS and paid billions in taxes, interest, and penalties under an IRS amnesty program.

http://english.pravda.ru/news/busine...ore_accounts-0

Then recently there was a rumor that a hacker broke into HBSC in Switzerland and got the names of 24,000 accounts and sold that information to the German government who shared the information with the French government who then tipped off the Spanish government. Apparently the Spanish government is currently probing 3,000 account holders. I suspect that the IRS also got a hold of that list.

http://www.pinewswire.net/2010/06/sp...nts-for-fraud/