US Reaches Info Sharing Agreement with Switzerland, Japan
WASHINGTON D.C. – The US has made agreements with Switzerland and Japan over the implementation of new reporting rules, which will see local banks provide the US with much greater amounts of data on US taxpayers.
On June 21st the US Department of the Treasury released two statements announcing that the Department has reached tentative agreements with corresponding authorities in Switzerland and Japan over the potential implementation of the US Foreign Account Tax Compliance Act (FATCA), which could strengthen efforts to combat international tax evasion by providing the IRS with more information regarding US taxpayers who hold accounts in Japan and Switzerland.
The agreements with Japan and Switzerland are expected to be finalized by August 2011, after which they will still need to be signed and ratified before coming into force.
If implemented, the agreements will require banks and other financial institutions in Japan and Switzerland to report data regarding its US clients directly to the Internal Revenue Service. The provided information will be checked against information held in the US about the taxpayer, and investigations will be conducted to find any discrepancies between the information held overseas and the information provided by the taxpayers themselves to the IRS. It is expected that the FACTA reporting rules will greatly aid the USA in finding evidence of national taxpayers hiding incomes and assets in overseas bank accounts.
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