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August 24 OVDP Deadline | OVDP Tax Lawyer & Attorney

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The fact that the IRS Offshore Voluntary Disclosure Program (“OVDP”) closes on September 28, 2018, obscured another important deadline that is much closer – the August 24 OVDP Deadline to submit the Preclearance Request.

August 24 OVDP Deadline: What is a Preclearance Request?

The Preclearance Request is basically a pre-application process to make sure that a taxpayer is eligible to apply for the OVDP. It is filed with the IRS Criminal Investigation Unit (“IRS-CI”), which will check for any outstanding investigations or examinations concerning the taxpayer.

August 24 OVDP Deadline: Is the Preclearance Request Required?

The short answer is “no”. I have seen a fair number of Internet blogs that mislead the taxpayers into believing that to the contrary, but this is simply false. A person can skip the Preclearance Request and apply directly to be accepted into the OVDP.

Nevertheless, even though the Preclearance Request is not an absolute requirement, it may be prudent to go through this process in some cases. It will be up to your international tax attorney to determine whether this is necessary.

What is the August 24 OVDP Deadline?

According to FAQ #11 published for the Closure of the OVDP, August 24, 2018 is the last day that a taxpayer will be able to submit his Preclearance (OVDP FAQ 23) Request to the IRS.

It should be remembered that the response to a Preclearance request may take 30 days or more (especially with the current rush to enter OVDP prior to its closure). In fact, the response to a Preclearance request may even come into conflict with the OVDP closure deadline. In such cases, it would be prudent to timely submit by September 28, 2018, the OVDP application letter required by OVDP FAQ #24.

Contact Sherayzen Law Office for Help With Your OVDP Application

If you have undisclosed offshore accounts and you wish to enter the OVDP, contact Sherayzen Law Office for professional help.

Sherayzen Law Office has successfully helped its clients around the globe with every type of an offshore voluntary disclosure, including 2009 OVDP, 2011 OVDI, 2012 OVDP and 2014 OVDP. We can help You!

Time is of the essence, because the current 2014 OVDP will close on September 28, 2018. Contact Us Today to Schedule Your Confidential Consultation!

US-Switzerland Bank Program: Migros Bank, Bank Coop, Linth Bank, Berner Kantonalbank and Vontobel Holding

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Several weeks ago, in another article, I detailed some of the recent developments in the US-Switzerland Bank Program, officially called The Program for Non-Prosecution Agreements or Non-Target Letters for Swiss Banks (the “US-Switzerland Bank Program”) between the U.S. Department of Justice (“DOJ”) and the government of Switzerland, and noted that Valiant Holdings AG had officially entered the Program. Since December 9th, the deadline imposed by Swiss Financial Market Supervisory Authority (“FINMA”) for Swiss banks to notify that authority whether they intended to enroll in the Program or not, more Swiss banks have announced that they will participate: Linth Bank, Migros Bank, Bank Coop, Berner Kantonalbank, and Vontobel Holding AG are among them.

Most Swiss banks are not listed on the stock exchange, so they not obliged to publicly disclose their intentions regarding the Program. This article will detail the further developments involving Swiss banks that have chosen to enter the US-Switzerland Bank Program, and is not intended to convey legal or tax advice. U.S. taxpayers holding Swiss accounts in any of the banks involved should pay close attention to these developments and seek the advice of professional, competent tax attorneys in these matters. The international tax expertise of Sherayzen Law Office, Ltd. can assist you in all of your tax and legal needs.

Migros Bank, Bank Coop, Linth Bank, and Berner Kantonalbank

According to various news sources, Migros Bank announced it would most likely enter the Program in Category 2. Migros Bank noted that just a small portion of its 800,000 customers are U.S. persons (and most of the U.S. persons either have dual U.S.-Switzerland citizenship or have U.S. residence permits). Because of the compliance difficulties in knowing whether such persons have paid all of their U.S. taxes (a requirement), they have decided to enter the US-Switzerland Bank Program. Migros Bank also noted that it might be approved under Category 4. The bank also claimed that it never actively sought out U.S. clients.

Bank Coop (majority-owned by Basler Kantonalbank, a bank that is already under investigation by the U.S.) also stated that it would enter the US-Switzerland Bank Program in Category 2. Bank Coop noted that accounts held by U.S. persons amounted to less than 0.3% of its total managed-accounts. Like Bank Migros, Bank Coop also claimed that it did not actively seek U.S. clients.

Linth Bank also announced it was entering the US-Switzerland Bank Program to attempt to bring a swift resolution the US-Switzerland dispute.

Like Migros Bank and Bank Coop, Berner Kantonalbank AG will enter the US-Switzerland Bank Program in Category 2. Berner Kantonalbank noted that a small portion (0.2%) of its managed accounts was held by U.S. persons. Its CEO, Hanspeter Ruefenacht, was quoted in one news report stating that the bank, “never sought to do business with American clients”.

Vontobel Holding AG

Vontobel Holding AG will also enroll in the US-Switzerland Bank Program, but under a different rational than the banks mentioned above. Vontobel Holding announced it will enter the US-Switzerland Bank Program under the DOJ’s category for Swiss banks that have not committed U.S. tax-related offenses (i.e. a Category 3 bank), and are thereby exempt from penalties under the Program. The bank stated that in 2008 it proactively instituted various measures to transfer its U.S. clients to its Swiss Wealth Advisors unit (which is registered with the Securities and Exchange Commission). American clients who decided not to move their assets to the advisors unit were made to leave the bank.

Impact on US Taxpayers

U.S. taxpayers who either hold or previously held undisclosed bank accounts at any of the Swiss banks eligible for the US-Switzerland Bank Program are advised to seek competent and experienced legal assistance. U.S. taxpayers will likely face substantial civil and potential criminal penalties if they continue to hold undisclosed accounts or if their cases are not handled properly.

Contact Sherayzen Law Office for Help With Undisclosed Swiss Accounts

The experienced international tax law firm of Sherayzen Law Office, Ltd. can help with your all of your voluntary disclosure issues, including undisclosed accounts and other assets in Switzerland.