IRS Seeks Credit Card Slips

The Internal Revenue Service estimates that it is losing about $70 billion annually in tax revenues as a result of U.S. citizens' failure to report income generated from their offshore accounts in the Caribbean. Banks in that area have used the Internet and other channels to solicit accounts from U.S. citizens. Their advertisements suggest that the IRS cannot obtain information on the income earned through these accounts. However, consumers with these offshore accounts frequently access them using credit or debit cards. In an effort to identify U.S. citizens who are hiding income generated from deposits in banks in the Caribbean, the Internal Revenue Service has asked a federal judge in Miami to issue summonses for records of credit card charges to banks in Antigua, Barbuda, the Bahamas and the Cayman Islands. The summonses will go to Visa, MasterCard and Discover and seek two years worth of credit card records showing charges to banks in those areas.