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Expats from Boston caught in Swiss bank move against tax evasion

On Behalf of | Sep 8, 2013 | Tax Evasion

A group of U.S. citizens, including Boston natives, living in Switzerland, said that they’ve been labeled tax dodgers. This was in reaction to a move by Swiss banks to prevent tax evasion through its secret accounts. The deal required banks to reveal data about clients and pay fines that reached up to $1 billion, spelling out even bigger trouble for actual tax evaders. That trouble came in the form of fines, penalties and possible prosecution if that information disclosed their identities to the Internal Revenue Service.

One prosecutor said that the IRS finding tax dodgers would now be the equivalent of shooting fish in a barrel. As might have been expected, financial industry experts who advise clients on tax issues were not happy about the rule changes. One expert with expatriate clients in Switzerland called the deal gunboat diplomacy for the 21st century, and Swiss newspapers shared this view, calling it an organized surrender that was like swallowing toads.

Part of what made this intervention into Swiss banking territory particularly unwelcome by the country was that Switzerland has always been fiercely independent. Its famous numbered accounts grew out of banking secrecy laws first enacted there during the Middle Ages. Since the U.S. started reaching into Swiss banking under a criminal investigation, about 38,000 American taxpayers have had to pay more than $5.5 billion in taxes, interest and fines.

Tax evasion isn’t as accepted, or as easy, as it once was. A lawyer experienced in tax law and criminal defense may be helpful to Boston taxpayers who are feeling the heat from accusations of tax evasion. Such a lawyer may be able to negotiate with authorities such as the IRS in order to come to a reasonable resolution.

Source: CNN, “How tax dodgers can survive the Swiss bank bust”, Lynnley Browning, September 03, 2013

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