Since the IRS has figured out how to avoid foreign bank’s privacy laws, some people are looking for alternative strategies.
Of course, these families may not have enough money for banking to be a reasonable option. Or, it is possible that those who have money are managing it through alternative techniques.
The motivation to use a bank to store money has certainly disappeared.
Besides, thanks to QE 3, banks don’t need customers’ money.
Therefore, the only reasons to put money into a bank are convenience or to provide collateral for a loan.
Banks know this.
Customers are learning it.
In addition, since cash is difficult to trace if it isn’t put into a bank account, some people may be shunning the use of banks to avoid taxes.
This becomes especially significant when we realize the IRS can jail bankers who want to maintain their customer’s privacy.
The IRS is seeking to breech other client confidentiality agreements too.
I currently earn part of my livelihood by preparing taxes. Therefore, I am actively aware of the newly implemented training and testing standards for tax preparers.
The Registered Tax Return Preparer (RTRP) requirements start this year with mandatory training. The RTRP test must be passed by the end of 2013.
Since I like to do things ahead of time, I have already passed the test and the IRS has recognized me as a RTRP.
During the training leading up to the exam, I was encouraged to take the next step and learn to practice before the IRS as a Registered Agent.
I was told this would increase business opportunities.
Then, I was told that Registered Agents could earn financial rewards from the service by helping the IRS collect taxes through snitching on clients.
I realized that learning to be a tax collector is obviously a point of emphasis for those who pursue becoming a Registered Agent. I have heard that CPA training requirements already include this emphasis.
I declined the additional training.
I work for my clients.
I do not work for the IRS.
A few weeks later, not long after receiving my RTRP Certificate, I watched this wide-ranging interview with Catherine Austin Fitts, Former Assistant Secretary of Housing under George H. W. Bush. I was surprised to hear her say the primary purpose of the RTRP testing requirements was to engage tax preparers as tax collectors.
I thought more about my recent training.
RTRPs have client confidentiality requirements that must be kept at all times, except when the IRS has a question. In those cases, RTRPs have an obligation to provide the IRS with anything clients have provided to them.
The RTRP training was Big Brother’s attempt to soften me up so I would take the additional training necessary to learn to snitch on my clients, just as bankers have been encouraged to turn in their account holders.
These feel like desperate acts of a government agency stooping to newer lows in an effort to loot the American people of its earnings on behalf of the bankers while violating privacy laws.
Will we see more of this type behavior from government as QE 3 increases government debt and, along with it, the need to collect a greater amount of tax revenue?