Court Authorizes IRS to Issue John Doe Summonses for Records Relating to U.S. Taxpayers with Offshore Bank Accounts With Trident Trust Group

A number of U.S. taxpayers with beneficial ownership and control over funds held in accounts at Trident Trust Group and its affiliates (collectively, “Trident”), have admitted failing to report income earned from their offshore accounts on their federal tax returns.  The IRS has reason to believe that other U.S. taxpayers who held or presently hold similar accounts at Trident have done the same in violation of federal tax law.

On December 23, 2024, a U.S. District Judge in the Southern District of New York entered an order authorizing the IRS to issue summonses requiring FedEx Corporation; DHL Express (USA), Inc.; United Parcel Service, Inc.; the Federal Reserve Bank of New York; The Clearing House Payments Company LLC; HSBC Bank USA, National Association; The Bank of New York Mellon Corporation; Wells Fargo Bank, National Association; Citibank, National Association; UBS AG; Bank of America, National Association; Deutsche Bank Trust Company Americas; and Nevis Services Limited, to produce information about U.S. taxpayers who may be evading or have evaded federal taxes by holding interests in undisclosed accounts at Trident.

The IRS uses John Doe summonses to obtain information about possible tax fraud by individuals whose identities are unknown.  The John Doe summonses direct the institutions named above to produce records identifying U.S. taxpayers with accounts at Trident.

The information that these institutions are required to turn over to the IRS will provide information about individuals using foreign financial institutions that include Switzerland, Caribbean countries, Hong Kong and beyond to avoid their U.S. tax obligations.  As the U.S. government is continuing its commitment to uncover and identify taxpayers who tried to hide money overseas as a way to avoid federal taxes, U.S. taxpayers still holding accounts who have not come clean should come forward and do the right thing before it is too late.

Federal tax law requires U.S. taxpayers to pay taxes on all income earned worldwide.  U.S. taxpayers must also report foreign financial accounts if the total value of the accounts exceeds $10,000 at any time during the calendar year.  Willful failure to report a foreign account can result in a fine of up to 50% of the amount in the account at the time of the violation and may even result in the IRS filing criminal charges.

If you have never reported your foreign investments on your U.S. Tax Returns, you should seriously consider participating in the IRS’s Offshore Voluntary Disclosure Program (OVDP).  Once the IRS contacts you, you cannot get into this program and would be subject to the maximum penalties (civil and criminal) under the tax law.  Taxpayers who hire an experienced tax attorney in Offshore Account Voluntary Disclosures should result in avoiding any pitfalls and gaining the maximum benefits conferred by this program.

What Should You Do?

Protect yourself from excessive fines and possible jail time. Federal and State Tax problems are usually a serious matter and must be handled appropriately so it’s important to that you’ve hired the best lawyer for your particular situation. The tax attorneys at the Law Offices Of Jeffrey B. Kahn, P.C. located in Orange County (Irvine), Los Angeles and elsewhere in California are highly skilled in handling tax matters and can effectively represent at all levels with the IRS and State Tax Agencies including criminal tax investigations and attempted prosecutions, undisclosed foreign bank accounts and other foreign assets, and unreported foreign income.  Also, if you are involved in cannabis, check out what our cannabis tax attorney can do for you.  Additionally, if you are involved in cryptocurrency, check out what a bitcoin tax attorney can do for you.