Call Now (800) 681-1295
Close

Taiwan and China Agree to Hand Over American Bank Account Info

Table of Contents

    As we have previously reported, foreign countries have been lining up to enter into agreements that will provide the United States government with foreign account information of American account holders. It seems like every day the United States is bragging about a new foreign territory that has agreed to turn over this potentially damaging information. It should come as no surprise that today is like any other day.

    On June 23rd the United States announced that it has come to an agreement with Taiwan regarding the recording of American held foreign accounts in the country. It is interesting to note that the agreement reached between the United States Taiwan was a Model 2 agreement, which only requires Taiwan to report information to the United States, and does not require the US to reciprocate in the sharing of information. It is unknown why Taiwan didn’t enter into a Model 1 agreement but one possibility is that it wanted to stay in conformity with similar agreements entered into by Hong Kong and Japan.

    There are generally two types of intergovernmental agreements (IGA’s). First and more common, the Model 1 agreement is essentially a pact to swap information. The agreement sets forth the plan whereby both countries will share certain financial account information with each other. The second type of agreement, also known as a Model 2 agreement, only requires the country that the United States has negotiated with to supply information about US account holders.

    The United States also announced last week that they had reached an agreement regarding foreign account disclosures with Chinese officials. Though the agreement is not official as of yet, the Department of the Treasury has stated that “agreements in substance” will be recognized and financial institutions within China will not face any of the negative consequences that come with FATCA noncompliance.

    There are Now 80 Foreign Countries and Jurisdictions that Cooperate with the IRS

    The addition of China and Taiwan to the list of foreign jurisdictions cooperating with United States government brings the total count to 80. This is bad news for American taxpayers that have foreign accounts that they have not yet disclosed government. Beginning on July 1, financial institutions from the 80 countries that have agreed to work with the United States will begin to send detailed information about accounts held by Americans to the Department of the Treasury. If it is discovered that a taxpayer has control over a foreign account but has not disclosed its existence to the federal government, a criminal investigation maybe opened and that taxpayer may be subject hefty penalties and the possibility of imprisonment.

    If you were a taxpayer that has in account overseas and you have not yet disclosed its existence to the federal government, hope is not lost. As we recently reported, the federal government has an established program to help you come clean about your foreign accounts. It is in your best interest to contact an experienced tax attorney who can analyze the specific faxing your case to determine what the best plan of action should be.

    What Should You Do if You Have Bank Accounts in Taiwan or China?

    If you ignore this warning and the government determines that you have willfully failed to file the necessary documentation to disclose foreign account, you will face penalties that could well exceed the amount of money in your foreign account. Further, if you have willfully evaded paying income tax on the growth of the money in your foreign account you can potentially spend years in federal prison. The experienced tax professionals at the Tax Law Offices of David W. Klasing have extensive experience in assisting US taxpayers in their attempts to come clean with the Government. We have helped our clients avoid lengthy prison sentences as well as dodge penalties that could greatly exceed the amount of money in the account that gave rise to the penalty itself. But if you have an undisclosed foreign account, you must act fast. If the government learns of your undisclosed foreign account before you enter the Offshore Voluntary Disclosure Program, you will not be eligible for the significantly decreased penalties and prison avoidance provisions of the program. Contact the Tax Law Offices of David W. Klasing today for a reduced-rate consultation.

    Tax Help Videos

    Representing Clients from U.S. and International Locations Regarding Federal and California Tax Issues

    tax lawyers

    Main Office

    Orange County
    2601 Main St. Penthouse Suite
    Irvine, CA 92614
    (949) 681-3502

    Our headquarters is located in Irvine, CA. Our beautiful 19,700 office space is staffed full-time and always available for our clients to meet with our highly qualified and experienced staff of Attorneys, Certified Public Accountants and Enrolled Agents. We also offer virtual consultations and can travel to meet with clients in one of our satellite offices.

    Outside of our 4 hour initial consultation option, we do not charge travel time or travel expenses when traveling to one of our Satellite offices, or surrounding business districts, where it is necessary to meet personally with taxing authority personnel, make court appearances, or any in person meeting deemed necessary for the effective representation of a client. To make this as flexible, efficient, and convenient as possible, David W. Klasing is an Instrument Rated Private Pilot and Utilizes the Firms Cirrus SR22 to service client’s in California and in the Southwest by air. Offices outside these areas are serviced via commercial jet airlines. None of these costs are charged to our clients.

    Satellite Offices

    California
    (310) 492-5583
    (760) 338-7035
    (916) 290-6625
    (415) 287-6568
    (909) 991-7557
    (619) 780-2538
    (661) 432-1480
    (818) 935-6098
    (805) 200-4053
    (510) 764-1020
    (408) 643-0573
    (760) 338-7035
    Arizona
    (602) 975-0296
    New Mexico
    (505) 206-5308
    New York
    (332) 224-8515
    Texas
    (512) 828-6646
    Washington, DC
    (202) 918-9329
    Nevada
    (702) 997-6465
    Florida
    (786) 999-8406
    Utah
    (385) 501-5934