The IRS has announced today that UBS will reveal names of 4,450 American account holders. The actual names have not yet been released, and over the next few months these account holders will receive notices from UBS that their names will be disclosed to the IRS. The account holders will then have the option of appealing the proposed disclosure to the Swiss appellate court on the grounds that the disclosure would violate Swiss banking secrecy laws. It is not yet clear how successful such appeals may be.
The IRS has indicated that these 4,450 accounts hold approximately $18 billion, or about $4 million per account (the number is probably even higher because a lot of these accounts have already been closed and money moved out). Obviously the focus of the disclosure is on the larger accounts.
U.S. taxpayers have until September 23 to voluntarily disclose unreported bank accounts (and possibly avoid criminal penalties and significantly reduce civil penalties). There is no guaranty that a U.S. person with an undisclosed UBS account will find out before September 23 whether their account will be disclosed. We strongly caution these individuals to contact UBS and find out whether their name will be disclosed.
Based on the voluntary disclosure program, the IRS has collected names of many other banks where Americans keep undisclosed bank accounts. The IRS has announced that it may start pressuring other banks to disclose names of American account holders. If you still have not disclosed a foreign bank account, please talk to a tax attorney to determine your options.
