A gaping hole in U.S. tax laws is allowing the rich to stash billions offshore in foreign bank accounts, according to lawmakers.
While the law requires Americans to report any foreign bank accounts and pay taxes on all income earned, not all of them do, and a 12-year-old law designed to crack down on offshore tax evasion is easy to circumvent, members of the Senate Finance Committee said in a report on Wednesday.
“As a result, wealthy taxpayers continue to use schemes involving offshore entities and secret bank accounts to successfully hide billions in income from the IRS,” the report said.
The case of Robert Brockman, a billionaire charged in the largest tax evasion case in history, highlights how loopholes in the nation’s tax code may be used to dodge taxes. In 2020, the Department of Justicewith hiding more than $2 billion in income from the IRS in a complex, decades-long scheme involving offshore accounts, foreign trusts and multiple shell companies.
Brockman died earlier this month while preparing to stand trial; his case was the impetus for the Senate Finance investigation. A civil case against his estate is ongoing.
Categories: Economics/Class Relations