Undisclosed Foreign Accounts Can Get You Into Trouble

One Alaska physician unsuccessfully tried to transfer money to a Panama bank to hide assets from his ex-wife. When the physician transferred the money in 2008, Panama was a notorious haven from the IRS and other creditors. In November, 2010, Panama signed a tax cooperation and information exchange agreement with the United States.

The Doctor’s Panamanian advisor tried to convince the Doctor that his best bet to protect his money would be to put it in a U.S. bank account under the guise of a foreign corporation. He made all the wire transfers by September 2011, but Homeland Security came in and seized it.

One California tax attorney cautions against undisclosed offshore accounts. They can quickly turn civil proceedings into criminal ones and so those with foreign accounts should report them to the IRS to be safe.

See Janet Novack, Hiding Millions From Your Ex Gets Harder, Thanks To Offshore Tax Crackdown, Forbes, Mar. 16, 2012.