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The United States Knows Where Offshore Tax Evaders Live And Bank!



The United States is tracking down hidden offshore accounts, and the latest news is a report that shows which states have the most taxpayers disclosing such accounts (California is No. 1), and where they are located (Switzerland is tops).

Taxpayers in at least 45 states and the District of Columbia reported accounts in 68 countries and territories.

The new U.S. Government Accountability Office report: “IRS’s Offshore Voluntary Disclosure Program (OVDP): 2009 Participation by State and Location of Foreign Bank Accounts,” is a supplement to its March 2013 report, “Offshore Tax Evasion: IRS Has Collected Billions of Dollars, but May be Missing Continued Evasion.”

In the new report, the GAO looked at 10,500 tax returns for 2008 filed by 2009 disclosure participants, and the 12,889 accompanying FBAR forms. Some taxpayers disclosed dozens of offshore accounts with multiple banks and in multiple countries; some disclosed just one account in one country.

Table 1: 2009 Offshore Voluntary Disclosure Program Participants by State 2008 tax return mailing address
Table 1: 2009 Offshore Voluntary Disclosure Program Participants by State 2008 tax return mailing address
Frequency
Percent
Alabama
26
<1%
Alaska
20
<1%
Arizona
146
1%
Arkansas
17
<1%
California
2,524
24%
Colorado
139
1%
Connecticut
210
2%
Delaware
17
<1%
District of Columbiaa
49
<1%
Florida
1,022
10%
Georgia
143
1%
Hawaii
59
1%
Idaho
11
<1%
Illinois
291
3%
Indiana
47
<1%
Iowa
17
<1%
Kansas
22
<1%
Kentucky
24
<1%
Louisiana
39
<1%
Maine
25
<1%
Maryland
203
2%
Massachusetts
307
3%
Michigan
129
1%
Minnesota
59
1%
Mississippi
11
<1%
Missouri
57
1%
Montanab
Nebraska
11
<1%
Nevada
97
1%
New Hampshire
40
<1%
New Jersey
631
6%
New Mexico
31
<1%
New York
1,844
18%
North Carolina
125
1%
North Dakotab
Ohio
159
2%
Oklahoma
17
<1%
Oregon
58
1%
Pennsylvania
269
3%
Rhode Island
25
<1%
South Carolina
50
<1%
South Dakotab
Tennessee
48
<1%
Texas
512
5%
Utah
26
<1%
Vermont
26
<1%
Virginia
184
2%
Washington
231
2%
West Virginiab
Wisconsin
49
<1%
Wyomingb
Subtotal of suppressed states b
29
<1%
Other addresses a,c
457
4%
TOTAL
10,533
100%

 

 

2: Locations of Foreign Bank Accounts Reported on Report of Foreign Bank and Financial Accounts (FBAR) Forms by 2009 Offshore Voluntary Disclosure Program Participants Country or territory

 

2: Locations of Foreign Bank Accounts Reported on Report of Foreign Bank and Financial Accounts (FBAR) Forms by 2009 Offshore Voluntary Disclosure Program Participants Country or territory
Frequency
Percent a
Switzerland
5,427
42%
United Kingdom
1,058
8%
Canada
556
4%
France
528
4%
Israel
510
4%
Germany
484
4%
China
394
3%
Hong Kong
362
3%
Taiwan
307
2%
India
306
2%
Italy
189
1%
Luxembourg
174
1%
Australia
161
1%
Singapore
156
1%
Cayman Islands
148
1%
Liechtenstein
142
1%
Netherlands
121
1%
Austria
116
1%
Ireland
110
1%
Sweden
107
1%
Belgium
106
1%
Mexico
102
1%
Isle of Man (UK)
90
1%
South Korea
86
1%
Japan
83
1%
Spain
82
1%
South Africa
81
1%
Jersey (UK)
72
1%
New Zealand
72
1%
Bahamas
69
1%
Brazil
59
<1%
Thailand
54
<1%
Bermuda
52
<1%
Denmark
52
<1%
Norway
50
<1%
Greece
49
<1%
Virgin Islands (British)
49
<1%
Monaco
45
<1%
Panama
44
<1%
Philippines
39
<1%
Costa Rica
33
<1%
Netherlands (Antilles)
32
<1%
Colombia
29
<1%
Turkey
29
<1%
Guernsey
26
<1%
Hungary
25
<1%
Malaysia
25
<1%
United Arab Emirates
22
<1%
Jamaica
20
<1%
Dominican Republic
18
<1%
Lebanon
18
<1%
Poland
18
<1%
Venezuela
18
<1%
Chile
15
<1%
Cyprus
15
<1%
Finland
15
<1%
Antigua & Barbuda
14
<1%
Argentina
14
<1%
Iran
14
<1%
Portugal
14
<1%
Russia
14
<1%
Egypt
13
<1%
Uruguay
13
<1%
Sri Lanka
12
<1%
Guatemala
12
<1%
Czech Republic
11
<1%
Pakistan
11
<1%
Saint Kitts & Nevis
10
<1%

 

The 58 other countries and territories included had 1% or less of the total number of foreign bank accounts reported. Offshore tax evasion continues to be a hot issue in Washington. The IRS included “hiding income offshore” on its dirty dozen list of tax scams for 2014, touting the voluntary disclosure program and warning: “It is in the best long-term interest of taxpayers to come forward, catch up on their filing requirements and pay their fair share.” The Senate Permanent Subcommittee on Investigations will hold a hearing on February 26, “Offshore Tax Evasion: The Effort to Collect Unpaid Taxes on Billions in Hidden Offshore Accounts.”

At the same time, the National Taxpayer Advocate, Nina Olson, in her January annual report to Congress, points out the impact of the disclosure programs on taxpayers who make honest mistakes as one of the most serious problems encountered by taxpayers.

Sources: GAO, Forbes

In accordance with Circular 230 Disclosure

Tony Beecher

4 thoughts on “The United States Knows Where Offshore Tax Evaders Live And Bank!

  1. bubblebustin says:

    It would appear that Canada ranks high as a tax haven.

  2. No assumption of guilt should be made. OVDP doesn’t differentiate between home landers with hidden offshore accounts and non-residents who have accounts in their country of residence. The U.S. definition of “offshore” is completely self serving as is the U.S. definition of who is a U.S. person. U.S. tax law makes it impossible for a non-resident to have an onshore account because U.S. tax law forbids U.S. persons from living abroad.
    Of course some people may say that isn’t true. But imagine if the U.S. government required a non-resident to buy your food from only U.S. government approved stores. Or denied a non-resident the right to have access to medical care that is not available in the U.S. or that isn’t covered by Medicaid or Medicare. Regardless of the fact that the U.S. government doesn’t fund the service.

  3. The true numbers need to account for only those who live within U.S. territory and have sent funds overseas that haven’t been reported. OVDP, FATCA and citizenship based taxation are GREAT HUMAN RIGHTS tragedies that only the U.S. could flagrantly and unashamedly practise. When it was the Russians, Chinese or the Nazis who were oppressing their people in similar ways the U.S. was on the side of the angels. My how the cards have turned.

  4. xyz says:

    Well well- Switzerland is number one because Delaware, Wyoming, Nevada were not included in the survey!

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