Advancing a U.S. crackdown on tax evasion by Americans, the U.S. Treasury Department said on Thursday that Switzerland and the United States have signed a pact to make Swiss banks disclose information about U.S. account-holders. The agreement is the latest in a series between the United States and other countries designed to carry out the Foreign Account Tax Compliance Act, or FATCA, enacted in 2010.
The Swiss deal is the first of its kind and differs in key ways from previous pacts. It requires Swiss banks to sign up directly with the U.S. Internal Revenue Service, while giving the banks a way to avoid violating Swiss financial secrecy laws. FATCA requires foreign financial institutions to tell the U.S. Internal Revenue Service about Americans' offshore accounts worth more than $50,000. FATCA was enacted after a Swiss banking scandal showed U.S. taxpayers hid millions of dollars overseas.
The pact announced on Thursday, known as an intergovernmental agreement (IGA), needs to be ratified
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