by Brian Mahany
HSBC always seems to be in the news these days. And it isn’t good news. Money laundering, helping Americans evade taxes and even helping narcoterrorists. Today’s news doesn’t come from Uncle Sam, however, it comes from AFIP, Argentina’s Revenue Service. The Argentines criminally charged HSBC Bank Argentina with evading taxes and money laundering.
Although banks are often accused of turning a blind eye towards money laundering, a news release from the government says that bank officials actively participated in the crime and subsequent coverup efforts.
The news is of great concern to Americans with accounts at HSBC worldwide. As we have noted before, Americans are allowed to have foreign bank accounts but must report them annually to the IRS. Many accounts – millions of them – remain unreported.
The majority of U.S. taxpayers with unreported accounts simply don’t understand the reporting requirements. Many of these folks are dual nationals, foreign born Americans, ex pats living overseas and foreigners working in the U.S. (green card holders). Others, however, rely on foreign accounts to evade taxes and hide their money from the IRS. Either way, unreported accounts are against the law.
Having an unreported account is considered tax fraud and can be a felony if willful. Even innocent violations are still subject to hefty civil penalties.
The IRS is running an amnesty program for unreported accounts called the Offshore Voluntary Disclosure Program (“OVDI”). There are other options as well. To qualify for any of these programs, however, you must apply before the government gets your name or contacts you first.
With so many problems at HSBC worldwide, it won’t be long before the IRS is at HSBC Bank of Argentina’s door looking for names of Americans with unreported accounts. If they aren’t doing so already. The U.S. Department of Justice and IRS have been rumored to be investigating accounts at HSBC in India, Switzerland, Israel and in the Caribbean. With this week’s indictments, Argentina is sure to be added to that list.
If you have an unreported foreign account, contact us immediately. Time is running out. We will give you an honest assessment of your options. Most of our foreign reporting work including tax amnesty, missing FBAR* filings and “opt outs” can be handled on a flat fee basis. We will even defend you for free if the IRS disagrees with our position.
Mahany & Ertl – America’s Tax Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine; Minneapolis, Minnesota and San Francisco, California. IRS tax services available worldwide.
Need more information? Our Due Diligence blog has a search engine located in the upper right hand corner. For more information on specific tax topics, just click the tax tab or type in the name of a particular tax topic such as “FBAR” or “OVDI” in the search bar. We have posted hundreds of informative articles on our site.
*If you don’t know what an FBAR is, you may already be in trouble! Innocent non filers qualify for a break however and may do better outside of amnesty. Qualifying foreign accounts including bank accounts, foreign hedge funds, CD’s, certain insurance products with an annuity or investment component and offshore brokerage accounts must be reported annually on a Report of Foreign Bank and Financial Accounts more commonly known as an FBAR or TD 90-22.1 form.