Category Archives: From Live Blog

As the current holder of the EU presidency, Denmark stated at a special meeting of EU member state officials that the United States has expressed a willingness to agree to a “government to government” solution on complying with FATCA, instead of having EU financial institutions provide the required information.

FATCA, which will enter into force on 1 January 2013 (certain implementing arrangements have nevertheless been postponed to 2014 and 2015), will impose full transparency obligations on European financial institutions with respect to deposits and assets held by all persons obliged to file returns with the US tax administration. Financial penalties will be imposed on banks that fail to play by the rules.

“It is urgent to work out a solution with the United States on the many problems the FATCA will cause for European financial institutions,” particularly in terms of administrative overload, writes Copenhagen.

The EU has already started negotiations with Washington. In this context, it is trying to convince the United States to be more flexible by playing on the “broad similarity” of aims between the FATCA and EU legislation on savings taxation – combating tax evasion – and ways of achieving them.

However, “the American authorities responded that the scope of the existing savings taxation directive is more limited than the FATCA’s scope,” writes Copenhagen. “So it is clear that early agreement on its extension would considerably help us obtain satisfying results in discussions with the United States.”

Stay tuned as the World works out its tax transparency issues!

Seizing more than $16 million from Wegelin's bank account in the United States under civil forfeiture laws, DOJ said Wegelin had been charged in the U.S. District Court for the Southern District of New York with participating in a conspiracy with three client advisors who have already been charged.

Although Wegelin has no banks in the U.S., it is accused of using a UBS AG account to carry out the conspiracy, which involved opening and servicing dozens of undeclared accounts for U.S. taxpayers to capture clients who were fleeing UBS after news broke that IRS was investigating that Swiss bank.

According to the indictment, Wegelin told various U.S. taxpayer-clients that their undeclared accounts would not be disclosed to U.S. authorities because the bank had a long tradition of secrecy and that the lack of offices in the United States made the company less vulnerable to U.S. authorities.

A federal court has ordered James Watts and eight corporations to begin paying employment taxes to the United States on a timely basis, the Justice Department announced today. According to the government complaint in the case, Watts, of Bettendorf, Iowa, is the president of Watts Trucking Service, Inc., an Iowa corporation, of which the other seven corporations are subsidiaries. The complaint alleges that the companies fail to pay over to the Internal Revenue Service (IRS) all of their employment and unemployment taxes, including the income and social security taxes withheld from their employees’ wages.

Chief Judge James E. Gritzner of the U.S. District Court for the Southern District of Iowa entered the preliminary injunction order, which requires Watts and the companies to comply with federal employment tax filing, deposit, and payment requirements, and to certify to the government that they have done so.The injunction also prohibits the defendants from closing a waste-handling business and reopening it under a new name without the written consent of the government.

According to the complaint, Watts has formed and controlled at least 23 different business entities over the past two decades, most of which have accrued delinquent tax liabilities.The complaint states that the defendant corporations, along with 15 inactive entities, owe the government over $30 million in federal employment and unemployment taxes.

The preliminary injunction will remain in effect while the case proceeds to final judgment. Violation of an injunction can result in civil and criminal sanctions, including fines and imprisonment.