Reply #17: But sometimes it's not taxed earning...

[Baby Snooks]

"If, for example, the money deposited in a Swiss account was obtained legally and consists of post taxed earning, do you still believe the IRS should tax the interest it's earned from a foreign bank while outside of the country."

But sometimes it's not taxed and it used to create offshore corporations which in turn produce income that is diverted to a Swiss account. Suddenly the checks that went to Joe Smith now go to Joe Smith, Inc. which is an offshore corporation. And suddenly Joe Smith doesn't owe any income tax. Which apparently was the problem with UBS. They were actualy helping American citizens set up these offshore corporations to create tax-free income-producing assets. It's quite complex which is why the IRS in particular has had problems along with the Justice Department.

Much of the complexity is the result of members of Congress like Phil Gramm who wrote tax law which creates legal illegality. Which is why so many of the tax evaders involved with UBS probably won't be prosecuted. They were evading taxes. But doing so legally. And they have done so since the point Bill Clinton signed it all into law. Our tax law is so complex at this point the law is really what you can convince a judge it is. If anyone bothers to indict you.

Or dares to. And don't kid yourself. There are quite a few wealthy Democrats who love it. And want to keep things just the way they are.