Global tax evasion has become a top focus throughout the United States and the rest of the developed nations as countries struggle with lingering budget shortages that are a holdover from the 2008 crash and following recession.  Countries are seeking to maximize their tax revenue by ensuring that people do not move money to foreign banks in order to avoid paying what is owed to the government. 

If you have any offshore financial accounts, you are required to file a Report of Foreign Bank and Financial Accounts (FBAR) to alert the Internal Revenue Service to your foreign investments. A failure to file FBARs can led to financial penalties, which in some cases have exceeded the value of the money kept in the foreign account. 

The Internal Revenue Service and the Justice Department have been making a major effort to crack down on offshore accounts that U.S. citizens do not declare. In addition to allowing tax payers to face reduced penalties if they voluntarily report these accounts through an Offshore Voluntary Disclosure Program (OVDP), the authorities have been making deals with Swiss banks to turn over information on accounts in exchange for lesser penalties or avoiding prosecution.  

Strict privacy laws have made banking an essential pillar of the Swiss economy. However, new treaties designed to prevent tax cheating through the use of offshore accounts are threatening the tradition of secrecy in Swiss banks. This has created upheaval within the industry. It is also raising concerns among U.S. taxpayers that money kept in offshore Swiss accounts may not be as safe, or as secret, as it used to be.  

Offshore voluntary disclosure programs (OVDP) make it possible to report offshore accounts to the Internal Revenue Service that you should have reported on in the past and didn’t. OVDP allows you to alert the IRS that you did not file the required Report of Foreign Bank and Financial Accounts (FBAR) that you must file each year. Streamlined OVDP procedures limit the penalties that you face for a failure to file the required forms, and also provide amnesty so you will not have to worry about criminal prosecution.