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HSBC Offshore Account Holders Likely Target of Continuing IRS Investigations

04th July 2011
By Jerselaw in Legal
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New Jersey Tax Attorneys of The Thorn Law Group are emerging as leaders in offering legal representation for U.S. taxpayers who, in many cases unwittingly, invested in undisclosed offshore bank accounts. Potential prosecution of Hong Kong Shanghai Banking Corporation (HSBC) clients is increasing as Internal Revenue Service (IRS) investigations continue.

The 2011 IRS Offshore Voluntary Disclosure Initiative (2011 OVDI) allows individuals who have failed to report offshore income avoid criminal prosecution. Those who filed improper, partial, or incomplete income tax returns are considered under specific circumstances. The program ends Aug. 31, 2011.

In April 2011, The U.S. Department of Justice (DOJ) began seeking a federal court order authorizing the IRS to "request information from HSBC Bank USA." According to the DOJ, "Records would be used to identify U.S. residents who evade paying federal taxes." The courts are expected to rule in favor of the DOJ and IRS.

A string of cases involving HSBC led to the DOJ request for information, and makes apparent a growing and wider investigation.

A New Jersey Grand Jury indicted a man for conspiracy to defraud the federal government in January 2011, the defendant is suspected of using accounts in the British Virgin Islands and with HSBC India to evade income taxes. Last year two men were convicted of fraud against HSBC and tax evasion. Then, a father and son in Florida were convicted of concealing millions with HSBC. In 2008 a New York women pleaded guilty of filing a false return involving accounts with HSBC India.

2011 OVDI is a "voluntary disclosure practice" derived from the IRS Criminal Manual. The intent is to allow filers who have failed to report overseas income, whether on bad advice, inheritance, or misunderstanding, the opportunity to avoid criminal charges. The initiative seeks to resolve cases in an "organized and coordinated manner."

Certified public accountant and tax attorney assistance is recommended.

The process begins with the IRS Criminal Investigation Lead Development Center. In a necessarily complex process taxpayers may be "cleared to make a voluntary disclosure." Once accepted the "Offshore Voluntary Disclosures Letter" is sent to be "accepted or declined."

Voluntary disclosers in the program, according to the IRS, are also used to gather information to "inhibit promoters and facilitators from soliciting new clients." Gathered information can be used to develop new investigations.

The Thorn Law Groupís New Jersey IRS Lawyers represent clients in the Offshore Voluntary Disclosure Initiative through the critical process. Their growing expertise protects HSBC account holders seeking compliance while protecting their assets.

"Dedicated to helping clients resolve complicated tax, criminal tax, and international tax problems."

Contact Mr. Kevin E. Thorn, Managing Partner of Thorn Law Group at 202-270-7273 or visit .
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