Americans in Israel Targeted by IRS for Tax Audits

Now the stakes have been raised as Israel will transfer detailed information on American-held financial accounts to U.S. tax authorities by Sept. 30, 2015, under the first phase of an accord to implement the Foreign Account Tax Compliance Act.

In the case of Israel with respect to each U.S. Reportable Account of each Reporting Israeli Financial Institution:

1. The name, address, and U.S. TIN of each Specified U.S. Person that is an Account Holder of such account and, in the case of a Non-U.S. Entity that, after application of the due diligence procedures set forth in Annex I, is identified as having one or more Controlling Persons that is a Specified U.S. Person, the name, address, and U.S. TIN (if any) of such entity and each such Specified U.S. Person;
2. The account number (or functional equivalent in the absence of an account number); 
3. The name and identifying number of the Reporting Israeli Financial Institution;  
4. The account balance or value (including, in the case of a Cash Value Insurance Contract or Annuity Contract, the Cash Value or surrender value) as of the end of the relevant calendar year or other appropriate reporting period or, if the account was closed during such year, immediately before closure; in the case of any Custodial Account:  

(A) the total gross amount of interest, the total gross amount of dividends, and the total gross amount of other income generated with respect to the assets held in the account, in each case paid or credited to the account (or with respect to the account) during the calendar year or other appropriate reporting period; and

(B) the total gross proceeds from the sale or redemption of property paid or credited to the account during the calendar year or other appropriate reporting period with respect to which the Reporting Israeli Financial Institution acted as a custodian, broker, nominee, 

or otherwise as an agent for the Account Holder;

(6) In the case of any Depository Account, the total gross amount of interest paid or credited to the account during the calendar year or other appropriate reporting period; and

(7) In the case of any account not described in subparagraph 2(a)(5) or 2(a)(6) of this Article, the total gross amount paid or credited to the Account Holder with respect to the account during the calendar year or other appropriate reporting period with respect to which the Reporting Israeli Financial Institution is the obligor or debtor, including the aggregate amount of any redemption payments made to the Account Holder during the calendar year or other appropriate reporting period.