Swiss Banks to Receive No Credit for Customers Who Entered OVDP without Banks' Encouragement


Tax Analysts Tax Notes reports that Kathryn Keneally, assistant attorney general for the Justice Department Tax Division, said that Swiss banks that enter the IRS’s newly-offered program will receive no credit for customers who entered the OVDP prior to the banks’ entry into the program. She made the comments on September 20, 2013, while discussing the program during a Civil and Criminal Tax Penalties panel at the American Bar Association Section of Taxation meeting in San Francisco. Jay R. Nanavati of Baker & Hostetler LLP asked whether an account opened before August 1, 2008, the start of the program's applicable period, would be considered non-disclosed at any time during the program if the account holder had entered the OVDP in 2011. Keneally said that an account was not disclosed if it was not disclosed when it should have been, adding that disclosing the account at a later date does not resolve the problem. The reference in the program's penalty provisions to giving banks credit for fully disclosed accounts applies to Swiss banks that have U.S. accounts that were handled properly, she said. "Banks won't get credit for people who did the right thing when the bank was not taking steps to make that happen," she said.

Topics:  Foreign Banks, IRS, Offshore Banks, Offshore Funds, OVDP, Self-Disclosure Requirements, Tax Evasion

Published In: Finance & Banking Updates, International Trade Updates, Tax Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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