On November 17, 2009, the IRS unveiled the criteria used to identify 4,450 U.S. investors with accounts in Swiss banking giant UBS whose names will be turned over to the IRS under an agreement with Switzerland.
My guess was that is was going to be strictly account value-based. That is, the IRS wanted the names of the 4,450 most valuable, in terms of dollars, accounts. I was close, but not quite. In addition, the IRS also wanted the accounts:
- in which the account holders engaged in the most egregious behavior
- in which the true identity of the account holders would be most difficult to identify through standard practices.
For item #1, I would say that highest account value is somewhat similar criteria. But agents within the IRS tell me they have the ability to discern if certain accounts were funded by illegal source income, like money laundering. Thus they wants those as well.
For item #2, my IRS people tell me that the IRS has tools to discover Americans using an off-shore proxies to avoid detection. The IRS doesnt' really want anyone to know about these tools to discover the most egregious and hidden account holders. My guess is that large incoming wire transfers is the most valuable clue they have. As they say…developing…