Geneva, Switzerland (GenevaLunch) – The US federal budget for 2010 covers an 8 percent funding increase for the IRS tax authority. The International Tax Review in its August issue notes that the “increased funding would allow for the hiring of approximately 800 new IRS enforcement personnel specifically focused on offshore tax avoidance and evasion.” The tougher stance on tax collection includes changes that affect US citizens living abroad. Those who live and bank in Switzerland have been increasingly vocal in recent weeks in their complaints about problems with the US tax system and the IRS tax authority.
New IRS requirements to list foreign bank holdings, IRS regulations that are scheduled to go into effect in January 2010 as well as the end 23 September 2009 to the “voluntary compliance initiative” have caused considerable confusion. A public meeting on US taxes takes place this evening 2 September in Geneva to address the issues. The meeting is sponsored by Democrats Abroad Switzerland (DACH), Republicans Abroad and American Citizens Abroad (ACA).
Public meeting for US taxpayers
American citizens and permanent residents living abroad will have a chance to participate in the Q&A session on double taxation, reporting requirements and penalties for non-compliance.
- Date: 2 September
- Location: LLC Room at Webster University in Bellevue, Canton Geneva
- Time: Doors open at 18:30.
Background: IRS Oversight Board commends IRS for five-year strategic plan (2009-2012)
But who will take our money to finance the mortgage?
Update 25 July 07:20 Switzerland (GenevaLunch) - Two well-known Swiss cooperative banks, Migros and Bank Raiffeisen, have made changes in recent weeks to their policies concerning customers who are US citizens, or who are resident in the US. Specifically, both banks refuse all contact from the US. The steps taken by the banks, who are best known for mortgages and retail banking to middle-class customers, are a clear indication that US pressure is having an impact on the Swiss banking system. The moves are part of a trend that saw UBS in July 2008 alert non-US citizens who were resident in the US that their accounts would be closed as it reduced its US business.
Ironically, it is Americans trying to lead normal lives and pay their bills through their banks who are most affected – not the infamously wealthy and stealthy people the Internal Revenue Service (IRS) is hunting down. Also affected: Swiss citizens living in the US and people of other nationalities who have at some point lived in both countries. These are not the mythical secret, numbered accounts made famous by the likes of James Bond, but typical Swiss bank accounts covered by data protection laws in Switzerland.
The problem is complicated for US citizens and residents living outside the US because, according to American Citizens Abroad, a Geneva-based group, US banks are increasingly applying “due diligence” rules to refuse banking services outside the country.
