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Are offshore accounts legal?

| Jul 3, 2019 | Criminal/Civil Tax Litigation |

A previous post on this blog talked about how a family of prominent New Yorkers must now serve a few months in federal prison for their role in a fraudulent tax scheme. The scheme involved an offshore account from which the family would withdraw money under the table into their personal accounts without paying applicable taxes.

The story serves as a good opportunity to remind the residents of White Plains that having an offshore account is not illegal. For one, an offshore account does not necessarily have to be in Switzerland or somewhere in the Caribbean, nor does it have to involve any particularly secretive activity.

Many New Yorkers, particularly those in the northern part of the state, may find it quite practical, for instance, to have a Canadian bank account. Moreover, there are many financial and investment and legal reasons why a person may want an offshore account.

The key to avoiding trouble with the Internal Revenue Service or other taxing authorities is not to hide the existence of the account. So long as a person is being up front about both the account and his or her deposits and withdrawals, the money can presumably be taxed appropriately. Therefore, the person is doing nothing wrong.

Still, though, a person may find himself or herself to be the subject of suspicion in part because they have an offshore bank account. In such cases, it may be important for the person to secure the assistance of an experienced criminal tax litigation or civil tax litigation attorney, particularly if there is an accusation of fraud or other wrongdoing involved.