Offshore accounts are bank accounts located outside of a person's country of residence. These accounts are often used for various reasons, including asset protection, tax benefits, and privacy. Individuals and businesses may choose to open offshore accounts in countries with favorable banking regulations, such as Switzerland or the Cayman Islands. While offshore accounts can provide legitimate financial advantages, they can also be associated with illegal activities like tax evasion. Governments monitor these accounts to ensure compliance with tax laws. It's important for account holders to understand the legal implications and reporting requirements related to their offshore accounts to avoid potential penalties.