President Donald Trump ran on the platform of "making America great again." Part of that platform involved moving forward with tax reform that would help achieve this goal. In an attempt to make this promise a reality, lawmakers are proposing various pieces of legislation that would impact current tax law. One such proposal deals specifically with the Foreign Account Tax Compliance Act (FATCA).
The IRS is very diligent when it comes to enforcing tax laws. It is particularly concerned that all earnings are reported, and that federal income taxes be paid on all earnings - even money earned outside of the United States. Failing to report international income can result in fines and penalties, as well as criminal charges.
Two years ago, former billionaire Sam Wyly lost a fraud trial in New York that exposed a web of offshore entities that were used to shelter millions of dollars. After the 2014 verdict, the IRS entered the fray seeking $1.4 billion in back taxes. Penalties and interest accounted for 80 percent of this amount.