Regular readers of my blogs have long heard me arguing that
the current voluntary disclosure programs for Americans abroad
are overly complex and can involve penalties that are far in excess
of what is reasonable.
The problem is that in recent years the U.S. government has
been going after Americans - usually living in the United
States - who are hiding money and income offshore. They
have been doing so by pressuring foreign (non-U.S.) banks to
cough up their American depositors.
The thing is, most of those American depositors are U.S.
citizens living in the countries where those banks are
located. Most of these people haven't filed U.S. returns,
but in many cases the reason is they didn't know they had
to, plus they rarely have much U.S. tax to pay. These people are
not the targets - they are collateral damage in the pursuit of
tax cheaters.
