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<DIV><FONT size=2><EM>Fox News: <A
href="http://www.foxnews.com/politics/2009/08/15/tax-dodgers-scramble-options-amid-crackdown/?test=latestnews">http://www.foxnews.com/politics/2009/08/15/tax-dodgers-scramble-options-amid-crackdown/?test=latestnews</A></EM></FONT></DIV>
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<H1>Tax Dodgers Scramble for Options Amid U.S. Crackdown</H1>
<H2>The U.S. and Swiss governments announced a court settlement last week in
efforts by the IRS to force Zurich-based UBS AG to turn over the names of some
52,000 Americans believed to be hiding nearly $15 billion in assets in secret
accounts. </H2>
<P class=by-line></P>
<P class=source>AP</P>
<P class=date>Saturday, August 15, 2009 </P>
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<P>A deal with Switzerland settling U.S. demands for the names of suspected tax
dodgers from a Swiss bank has a lot of wealthy Americans with offshore accounts
nervously running to their tax advisers -- and the Internal Revenue Service.</P>
<P>"They are very frightened," said Richard Boggs, chief executive of Nationwide
Tax Relief, a Los-Angeles-based tax firm that specializes in clients with tax
debts exceeding $100,000. "You have the super rich who are not used to being
pushed around and they are finding themselves in unfamiliar territory."</P>
<P>The U.S. and Swiss governments announced a court settlement last week in
efforts by the IRS to force Zurich-based UBS AG to turn over the names of some
52,000 Americans believed to be hiding nearly $15 billion in assets in secret
accounts.</P>
<P>Justice Department and UBS lawyers told a federal judge in Miami in a brief
conference call Wednesday they had initialed a final deal. But they did not
disclose any details, such as how many of the 52,000 names sought by the IRS
will be revealed.</P>
<P>Even before the settlement, the high-profile case -- coupled with other U.S.
efforts to go after Americans hiding undeclared assets -- has scared hundreds of
tax dodgers to turn themselves in. Boggs said his firm has been taking on 100
new cases a month, a big increase over previous years.</P>
<P>Peter Zeidenberg, a litigation partner at the law firm DLA Piper in
Washington, said he, too, is he seeing more people with undeclared assets
seeking information about their legal options.</P>
<P>His advice: "I don't think you have much of a choice but to come forward. ...
I think the landscape is permanently changed."</P>
<P>The IRS long has had a policy that certain tax evaders who come forward
before they are contacted by the agency usually can avoid jail time as long as
they agree to pay back taxes, interest and hefty penalties. Drug dealers and
money launderers need not apply. But if the money was earned legally, tax
evaders can usually avoid criminal prosecution.</P>
<P>In March, the IRS began a six-month amnesty program that sweetened the offer
with reduced penalties for people with undeclared assets. IRS Commissioner Doug
Shulman said the response has been unprecedented.</P>
<P>Shulman wouldn't say how many people have applied so far. But the IRS said
400 people applied to voluntarily disclose undeclared assets in a single week in
July, compared with fewer than 100 applications all last year.</P>
<P>The amnesty program, which ends Sept. 23, is part of a larger effort by
federal authorities to crack down on international tax evaders.</P>
<P>"Each time someone walks through the door with a disclosure, we get more
information. We get more information about other people. We get more information
about other financial institutions," Shulman said. "If people have been hiding
assets in the past, they should be nervous, and they should be a lot more
suspect about doing it in the future."</P>
<P>The U.S. recently reached agreements with several countries, including
Luxembourg and Switzerland, to share more tax information in the future, just as
the IRS is strengthening its enforcement ranks.</P>
<P>President Barack Obama, in his proposed 2010 budget, asked Congress to pay
for 800 additional agents, examiners and lawyers to go after people who hide
money overseas. Obama also wants Congress to require overseas financial
institutions doing business in the U.S. to share more information with the
IRS.</P>
<P>Earlier this year, UBS admitted assisting U.S. citizens in evading taxes as
part of a deferred prosecution agreement with the Justice Department. UBS agreed
to disclose the names of about 300 American clients and pay a $780 million
penalty. The IRS subsequently filed its case seeking the names of 52,000
additional U.S. taxpayers believed to be hiding assets in UBS accounts.</P>
<P>So far, four UBS customers whose names were given to U.S. authorities under
the prior agreement have made deals to plead guilty to tax charges in federal
court.</P>
<P>"The UBS case, the agreements we are signing, the legislative proposals and
the enforcement efforts are all meant to send one message, which is that if you
owe tax to the U.S., we are going to use every tool we have available to get
that," said Michael Mundaca, acting assistant treasury secretary.</P>
<P>Sen. Carl Levin, D-Mich., applauded the administration's efforts, but said
more can be done to catch tax evaders. Levin has introduced a bill that would
direct the treasury secretary to maintain a list of nations that "impede U.S.
tax enforcement" and give him authority to impose financial penalties against
uncooperative countries.</P>
<P>Levin's initial list of 34 countries and other jurisdictions would include
Switzerland, the Cayman Islands, Bermuda, the Bahamas, Hong Kong and Panama.</P>
<P>"We should have put a clampdown on these tax havens a long time ago," he said
in an interview.</P>
<P>Raymond Baker of Global Financial Integrity, a Washington-based group that
advocates tougher policies against international money laundering, said he is
encouraged by the administration's efforts. But he's not ready to call it a
crackdown.</P>
<P>"As we get past the UBS case, is the momentum for continuing to go after tax
evaders going to be sustained?" Baker said. "I think it's too early to
tell."</P>
<P>It would, however, be risky for a wealthy tax dodger to wait to see if the
government's stepped up efforts continue, said Boggs, the tax adviser. He said
his firm usually recommends a "strategic surrender" to the IRS.</P>
<P>"We basically are waving a white flag and telling the IRS that we have every
intention of resolving this issue in the mutual best interest of the government
and our client," Boggs said.</P>
<P>"Historically, the best outcomes that we have been able to negotiate have
always involved good faith from the taxpayer," he said. "And good faith means
getting to the IRS before they get to you."</P></DIV></DIV></BODY></HTML>