The IRS met its deadline to begin the reciprocal automatic exchange of tax information with some foreign jurisdiction tax administrators as agreed under the intergovernmental agreements (IGAs) as part of the Foreign Account Tax Compliance Act (FATCA). As of September 30, 2015, the IRS can now reciprocate and provide information to the other jurisdictions who have shared information regarding financial accounts held by U.S. taxpayers with the IRS.
The information now available provides the United States and partner jurisdictions an improved means of verifying the tax compliance of taxpayers using offshore banking and investment facilities, and improves detection of those who may attempt to evade reporting the existence of offshore accounts and the income attributable to those accounts.
IRS Commissioner John Koskinen said, “This groundbreaking effort has fundamentally altered our relationship with tax authorities around the world, giving us all a much stronger hand in fighting illegal tax avoidance and leveling the playing field” and noted that the risks of hiding money offshore are growing and the potential rewards are shrinking.
