Scott Michel Comments on War on Tax Cheats

Caplin & Drysdale's Scott D. Michel commented on the string of victories in the global crackdown against offshore tax evaders. Swiss banks have now paid nearly $4 billion in various enforcement actions, the IRS's voluntary disclosure program has recovered $7 billion in taxes, penalties, and interest, and FATCA has all but ended bank secrecy. Mr. Michel noted that since the secrecy associated with Swiss accounts, which are otherwise considered safe and secure, is long gone, there are few realistic options for Americans to continue to hide money overseas. For the complete article, please visit The Hill's website.

Excerpt taken from the article. 

"The risk calculus for an American to hide money somewhere has changed dramatically from where it was 10 years ago. Dramatically," said Scott Michel, an expert on offshore tax issues with Caplin & Drysdale.

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But both Michel and Harrington, now a partner at Dentons, were quick to note that while other options exist, the safety and security that came with the secret Swiss accounts of old may be long gone.

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Michel said "there may be some governments that want to thumb their nose at the U.S., but my guess is that the correlation between that list of countries and the place you want to put your life savings is pretty small."

He added that other novel approaches to escaping U.S. taxes could carry their own significant burdens, like handing over control of your finances to a foreign party or investing funds in non-reportable, but hard-to-access, assets like land.

"Having money overseas is a bit of an albatross around your neck," he said. "How do you use it and what happens when you want to sell it? What happens when you die? Do you turn your children into tax felons?"