If I open an account at a US branch of a Swiss bank, do I get the same benefits?

Oldman answered 3 months ago …

Now I understand the question. No, you don't get the same "benefits". The account will be denominated in USD not Swiss Francs; a 1099 Div will be sent by the bank's acountants for your 1040 return; the confidentiality rules the Banks follow overseas, do not apply to the branches in the U.S. The account may or may not be FDIC insured, and the interest rates on accounts will vary with the Swiss Bank's branch competition, by location in the U.S.

At tax time, for a person who files a U.S. return (citizen or foreign national), the reporting rules for monies held overseas are pretty cumbersome, but very common:

There are lots of U.S. citizens who live overseas and bank at their "foreign" bank and pay taxes here, and receive their Social Security checks deposited at the foreign bank, in the case of retirees. In addition, many U.S. citizens are employed by international or foreign companies and bank overseas, not to mention the thousands of foreign nationals who work in the U.S., and pay U.S. income taxes on their income from both foreign and domestic employment.

If you are concerned about the "credit-worthiness" of a U.S. bank, you can go to BankRate.com, and for foreign banks, the issues are similar, many have the toxic CDO derivatives on their books. Never the less, you can still buy a CD at "defunct" banks like Countrywide, and up to the FDIC limit, the principal and interest are "guaranteed" for payment, but it might take a bit of time if the FDIC has to file forms for you. With overseas banks, there is no guarantee.

Years ago, one could have an "offshore" account at the Isle of Mann, the Caymans, Lichtenstein, etc...these were illegal tax-havens. Since the 9-11 attacks here and similar ones overseas in Britain, France, Spain, and many other areas, Interpol and the U.S. Treasury not only follow even small money flows (recall the recent governor of NYS, whose payments from a secretive account for the "services" of a type that were illegal in NY and disclosed by this tracking), but they share this information internationally. The IRS has really cracked down on these shady, offshore depositaries.

Possibly the only benefit one could have from depositing money in a Swiss account, in Switzerland, is the deductibility of the cost to set up, in person, the account. But no meals or hotel accomodations can be claimed, only the air & taxi-fares, and only up to Business Class rates...if one wanted to visit awhile and enjoy the raclette and Yvorne wine, you'd need to prorate the cost between business and "pleasure".