IRS extends deadline for disclosing off-shore accounts

The Internal Revenue Service is extending the deadline for special voluntary disclosures by taxpayers with unreported income from hidden offshore accounts from Sept. 23 to Oct. 15.

Under special provisions issued in March, taxpayers who voluntarily disclose their hidden accounts possibly could receive less harsh civil penalties and avoid criminal prosecution. The IRS extended the deadline in response to requests from lawyers representing some of those who are willing to disclose offshore accounts. The IRS said it wouldn't allow any further extensions.

UBS, U.S. and Swiss reach deal on releasing names of possible tax evaders

UBS AG and the U.S. and Swiss governments have worked out agreements to settle a dispute over whether the Swiss bank should be forced to disclose the names of 52,000 wealthy American clients suspected of tax evasion, media outlets reported today.

UBS and the two governments have initialed agreements that will "take a little time to be signed in final form," Department of Justice lawyer Stuart Gibson told U.S. District Court Judge Alan Gold during a brief conference call on Wednesday, according to Reuters.

"For U.S. taxpayers it is going to be impossible to hide money in Switzerland and it is just a matter of time that this is the case also for Germans and Britons," Asher Rubinstein, a partner at law firm Rubinstein & Rubinstein, said in a separate story by Reuters.

See also:

- UBS Tax Lawsuit Settled by U.S., Swiss Governments (Bloomberg)

- UBS Welcomes IRS Settlement (Dow Jones Newswires)

Guernsey: low-tax jurisdiction or tax haven?

The New York Times ran an article today about Guernsey's popularity with rich Britons who take advantage of a loophole in British law that allows individuals to become nonresidents for tax purposes but remain citizens as long as they do not spend more than 90 days a year on British soil.

But British authorities are beginning to challenge the application of that loophole, the Times says.

The Times story cites an estimate by the Organization for Economic Cooperation and Development that "wealthy individuals hold about $6 trillion offshore, resulting in billions of dollars in lost tax revenue for their home countries annually."

Op-ed advocates maintaining strict Swiss financial privacy laws

The president of a Swiss research institution argues today in a New York Times op-ed that Switzerland should maintain its strict banking privacy laws despite pressure from other countries to change them.

". . . Our financial privacy laws are a foundation for individual dignity and basic property rights," says Pierre Bessard, president of the Liberales Institut. "We will not solve the global problem of tax evasion by punishing honest depositors and destroying Swiss traditions."

UBS, Swiss and U.S. reach agreement on info about U.S. clients

UBS and the Swiss government have reached an agreement in principle with the U.S. to give the U.S. information about some American UBS clients who the U.S. maintains are evading taxes through accounts with the Swiss bank, according to media reports.

Reuters reported that, "A U.S. government source told Reuters on Friday he expected UBS not to pay a fine as part of the deal and Swiss newspapers reported the settlement would include the bank handing over 5,000 names of U.S. clients holding secret Swiss accounts -- about 10 percent of the names Washington was after."

The Wall Street Journal reported that UBS and the Swiss government had resolved their concerns about violating Swiss bank-privacy laws by combing through UBS client files and identifying "enough potential fraud to make them willing to hand over information about certain accounts.

"Swiss laws don't provide confidentiality if people engage in fraudulent activities such as setting up accounts with shell companies that lack any real business substance," The Wall Street Journal said.

For-profit operations require not-for-profit hospital system to pay taxes

A state judge has ruled a healthcare provider system in Minnesota has to pay personal property taxes on office equipment in its corporate headquarters because it runs for-profit operations as well as not-for-profit hospitals, Modern Healthcare reports.

Details about the case involving ProHealth Care are found at Modern Healthcare. (Registration required.)

UBS fight with IRS convinces Swiss banks to drop U.S. clients

More ripples from the UBS-IRS standoff: Some Swiss banks reportedly aren't accepting or are cutting off U.S. clients out of concern the Internal Revenue Service might get into a similar fight with them over client account information as it has with UBS AG.

DowJones Newswires says it's "a sign that UBS AG's high-profile spat with the Internal Revenue Service is chipping away at Switzerland's private banking industry."

The IRS is after information about the UBS accounts of 52,000 U.S. citizens in a major tax-evasion probe, challenging not just UBS but Swiss bank-secrecy laws.