Offshore Accounts Article in Daily Journal

May 21, 2012

“Offshore Assets and Divorce: Do’s and Don’ts”

On May 21, 2012, the Daily Journal published “Offshore Assets and Divorce: Do’s and Don’ts”, an article by co-founding partner Daniel J. Jaffe and Sandra P. Mendell about the solutions available to divorce attorneys whose clients have offshore bank accounts that have not been properly disclosed to the Internal Revenue Service (IRS).

According to the article, U.S. taxpayers must disclose foreign bank accounts holding $10,000 or more “in which they have had a financial interest or signature authority at any time during the applicable tax year.” Those who do not make the disclosure may be subject to criminal prosecution as well as substantial criminal and civil penalties.

The article offers pragmatic advice for attorneys. This includes encouraging the client to participate in a governmental amnesty program, enlisting the cooperation of the opposing spouse when engaging the IRS, and refusing to participate in any effort to conceal or secretly divide the assets.

“Lawyers involved in furthering such schemes, may become the target of IRS investigation”, Jaffe and Mendell wrote. “When this scenario was raised at a recent tax conference, an assistant U.S. attorney panel member said, ‘I would prosecute the lawyer for money laundering’, and a federal judge added, ‘I would convict.’ Enough said.”

For the full article, click here.