Child credit scam prompts U.S. tax crackdown on expats in Israel

TEL AVIV (Reuters) - It was called the "Israel Project", an operation by the U.S. Internal Revenue Service (IRS) that has uncovered false claims for child tax credits involving an estimated tens of millions of dollars filed by U.S. citizens living in Israel.

About 200,000 American citizens live in Israel, one of the largest U.S. expatriate communities, and in a separate inquiry, U.S. regulators are investigating whether Israeli banks helped American clients evade U.S. taxes, mostly at Swiss subsidiaries.