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Monthly Archives: January 2014

USA bank account? Be afraid, be very afraid

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For many years, whenever offshore tax avoidance issues are discussed, many South Africans suggested that having a bank account in Delaware or with any USA bank was rather safe from prying eyes. The USA was not tainted as a tax haven despite the Delaware arrangements.
A recent USA court ruling, slapping a USA bank on the fingers for trying to escape the IRS reporting requirements, makes for interesting reading.
This is the IRS way of thanking SARS for entering into signing the FATCA agreement negotiations.
BIG DADDY IS WATCHING – not even your Google account was safe from IRS/USA government. What made you think your USA bank account was safe?
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Monday, January 13, 2014
Court Rejects Banking Associations’ Challenge to
Regulations Addressing Offshore Tax Avoidance

Today the District Court in the District of Columbia dismissed a challenge filed by the Florida Bankers Association and Texas Bankers Association challenging 2012 amendments to the Department of the Treasury’s interest-reporting regulations.  The regulations require U.S. banks to report to the Internal Revenue Service (IRS) information about accounts earning more than $10 of interest beginning in 2013 that are held by non-resident aliens of all countries with which the United States has a tax treaty or other information exchange agreement [Blogger adds: South Africa is included in this list!].  These new reporting requirements help the United States’ ability to comply with requests from its treaty and exchange partners and implement the Foreign Account Tax Compliance Act.

“This ruling advances the Department of Justice’s and Internal Revenue Service’s continuing efforts to pursue taxpayers trying to evade taxes through offshore accounts,” said Assistant Attorney General Kathryn Keneally of the Tax Division.  “The court’s opinion today represents an important step in our commitment to work with our treaty partners to eliminate cross-border tax evasion.” 

The court upheld the regulations’ 2012 amendments, finding that the IRS “reasonably concluded that the regulations will improve U.S. tax compliance, deter foreign and domestic tax evasion, impose a minimal reporting burden on banks, and not cause any rational actor – other than a tax evader – to withdraw his funds from U.S. accounts.”

The court’s decision affirms the IRS’ ongoing efforts to close the tax gap through cooperative measures with foreign governments, including the  2012 amendments. 

14-042                            Tax Division


Ryno Viljoen, CEO at Cashkows.com says:

Friendly advice for all South Africans abroad,  and/or planning to move overseas. Please feel free to share this with your family and friends.http://www.cashkows.com/retirement-annuity-surrender.asp

Early Retirement Annuity Surrender & Planning |

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