Scare tactics the IRS uses to discourage offshore banking

Written by Andrew Henderson

I spent this past weekend at the Liberty Mastermind conference in Dallas, it was half-jokingly suggested that the organizers might as well have hosted a liberty event in North Korea.

In the Land of the Free, it’s no secret the IRS and other Big Government agencies don’t want you banking offshore. Sadly, they’ve been more successful in pushing their propaganda than their counterparts in Pyongyang.

In the same way government propaganda has shut down tourist traffic to Mexico on the basis that any gringo will get his head blown off by the drug cartels within five minutes of landing, the IRS scare tactics and red tape have shamed Americans into keeping all their money in one neat little basket within US borders.

The minute some bureaucrat wants to shut down your account, they can. And that’s not even counting the possibility of wealth or retirement account confiscation.

Keeping every penny you have within one country’s borders isn’t a smart move. Governments have been playing their cards much more openly as of late. They want your money, and if they can’t take it, they’ll “tax” it (with the word “tax” being as broad as the Grand Canyon).

The IRS recently announced it was expanding its search for unreported banking accounts by going full-scale in places like Australia. Never mind the fact that draconian, we-own-the-world laws like FATCA have forced every other country and every bank within them to be unpaid rats for the IRS.

No, the IRS is sending its agents – some of the thousands hired by Obamacare – to countries with better economies than its own to track down people who dare to stash some cash there. They’ll be shaking down bank officials and doing their usual dance of bypassing local and US laws to get what they need.

We’ve seen this before. It’s not unheard of for rogue bank employees to sell thumb drives full of customer data to willing tax authority agents in covert transactions. Authorities like the IRS and their bankrupt counterparts in western Europe are setting out on an all-out mission to catch you by hook or by crook.

I absolutely believe you should disclose your offshore banking accounts as required on the FBAR form and on your tax return. But at what point does the IRS stop throwing money at every draconian, even illegal, way to squeeze every nickel out of people?

You don’t have to look far to find out. Just recently, we’ve seen the IRS bullying banks in the Caribbean, demanding they turn over US customer information. The US government, bless their heart, has no compunction for whatever laws other country has. They just wave the American flag, say “ours is bigger than yours”, and push until they hit the nerve.

Now, the IRS is also ramping up enforcement against so-called “quiet disclosures” by expats who often didn’t know they had to report their “offshore” bank accounts. You know, the ones in the country they lived in. The IRS doesn’t differentiate between fat cats moving millions to numbered bank accounts in Switzerland and people who live in Switzerland and keep a checking account there.

And, oh wait, all but a handful of Swiss banks don’t accept Americans anymore, and numbered bank accounts are a thing of the past. Good thing the taxman is around to spread propaganda that’s not even true anymore.

I even read an article recently where a Florida lawyer said he was very skeptical when clients asked about offshore banking. The guy made it sound like anyone who asked him about it was a terrorist. When the IRS has trust attorneys freaked out, they’ve done their job.

And it’s not just the US. Italian tax authorities are going after the Vatican’s offshore bank, which isn’t exactly offshore nor a bank. Of course, “terrorism” was the first word they used to defend their attack.

The fact is, it’s perfectly legal to have money in an offshore bank account. There are reporting requirements in the US and elsewhere once you hit a nominal amount of money, but that doesn’t mean you can’t have an account.

With the way things are going, however, that legality may not always be the case. The US government – and other governments as well – have mastered the art of convincing you they’re all about freedom while they boil your frog in a pot. They’ve learned the lessons of governments that made the mistake of using armed intimidation to steal your money, and now merely chip away at your economic freedom one piece at a time. Most barely notice.

They renamed theft a “stability” levy in Cyprus. They’re trying to force you to put your retirement account into government bonds so they can keep their lavish party going – doing things like hiring more IRS agents to spy on you. They imposed capital controls in places like Cyprus, and many report taking legally declared stacks of cash out of US airports has caused highly-raised eyebrows from the Gestapo.

Europe is even using ridiculous pretense to get rid of the 500-euro note, effectively another form of capital controls itself.

Edward Snowden recently wrote about the “the old, bad tools of political aggression” governments use to scare their citizens. They make a few examples and wait for people to get freaked out and resign themselves to being slaves.

The question is, will you let the IRS and other government thugs intimidate you? Will you buy into their lies that offshore banking and “tax havens” are the stuff of evil Bond movie villains up to no good? Or will you live your life in compliance with their BS laws and protect your money while you can? Until they can convince the sheep to fully embrace capital controls and batten down all of the financial escape hatches, all they can do to discourage you is propaganda and lies. Don’t let them scare you.

Because the sand is running to the anti-freedom side of the hourglass. Once it’s fully there, time’s up. Opening an offshore bank account – even if you don’t have a lot of money – is a good first step.

Andrew Henderson
Last updated: Dec 30, 2019 at 3:06PM

Start Your Offshore Journey Today

The Nomad Capitalist team has helped hundreds of people create and execute prolific offshore plans to help them legally reduce their taxes, become dual citizens, and live the Nomad Capitalist lifestyle of success

Start Your Offshore Journey Today

The Nomad Capitalist team has helped hundreds of people create and execute prolific offshore plans to help them legally reduce their taxes, become dual citizens, and live the Nomad Capitalist lifestyle of successWould you like to be next?

Get Our Latest Offshore Strategies

Join our email list and we’ll send our best articles, videos and events right to your inbox

Read this next..

1 Comment

  1. SwissTechie

    I don’t follow why individuals need to be threatened with massive fines for having a local checking account that they use to pay their rent or food expenses. Eritrea gets internationally condemned for threatening its diaspora with much less. How is a developmentally disadvantaged individual supposed to figure out how to file FBAR online while tech geeks are scratching their heads trying to figure out how it is done on a Mac? Maybe this would be less bad if the developmentally disadvantaged could relinquish their US citizenship to flee their inability of being local-bank compliant by US standards, yet they cannot even do so since they also aren’t capable of understanding relinquishments! What will a 6 year old kid do with the $10’000 fine they got for not reporting their local savings account? Wrap it into a plane and throw it out of the window.

    All of this American stuff is great for America within its jurisdiction, but maybe it is best for America to continue being in America instead of making a mess of things on the other side.