‘There’s a Chill in the Air Right Now’ as Financial Transparency Rules Loom

Beginning this spring and summer, the US government will put into action new international financial transparency regulations aimed at catching tax dodgers.  As one Miami banking lawyer put it, “There’s a lot of anxiety out there.”

Next month comes the first reporting deadline of the so-called “NRA” provisions for non-resident aliens, a citizen of another country who has not been granted permanent in the US.  The NRA rules require the reporting of interest on deposits maintained at US offices of financial institutions and paid to non-resident aliens on or after Jan. 1, 2013.

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Dara Green, director of international tax at the Miami accounting firm of Kaufman Rossin, said clients who are US citizens are skittish about the new reporting requirements.  Ms. Green said some are entering voluntary disclosure programs with the Internal Revenue Service to reduce potential civil penalties for not previously reporting their offshore assets.  Some clients, she added, are expecting civil penalties and are entering the programs to avoid possible criminal penalties.

“There are people coming to us now who want to know how to report all of this and come clean.” Ms. Green Said.