Foreign Account Tax Compliance Act

@ Spring B > Thank you for this sharing of information, it is very much appreciated. 

Priscilla

No prob - I figure, if it's useful - share it! 

The banks around here really don't care what the United States wants them to do.

HaileyinHongKong wrote:

The banks around here really don't care what the United States wants them to do.

Soon, anyone transferring money from a US bank to a non-compliant bank will have 30% taxes withheld.  In countries that do not have bank reporting agreements with the USA, individual banks can agree to do the requested reporting to avoid the 30% withholding.  About 20 banks are already on that list in Ecuador.

This is why banks in the DR though required to report for the last 4 years (part of the CAFTA agreement) that have not been reporting (most banks) will start reporting this year.

Bob K

mugtech wrote:

HaileyinHongKong wrote:

The banks around here really don't care what the United States wants them to do.

Soon, anyone transferring money from a US bank to a non-compliant bank will have 30% taxes withheld.  In countries that do not have bank reporting agreements with the USA, individual banks can agree to do the requested reporting to avoid the 30% withholding.  About 20 banks are already on that list in Ecuador.

Please quote a source.

GOYA

Info available on IRS website, withholding kicks in next year, 1/1/15.

Actual compliance is supposed to start July 1, 2014, but there are ways for financial institutions to delay the withholding 6 months and then be compliant going forward, but theoretically everyone will either be compliant or be withheld as of 1/1/15.  You will need to check your specific country's financial institution if the country is not one of the 49 listed as of 4/10/14, for you could be hit with the withholding next month.  The countries with treaties in the western hemisphere are Bermuda, Canada, Cayman Islands, Chile, Costa Rica, Honduras and Mexico.  Those without treaties but considered compliant are Bahamas, Brazil and Jamaica.

They should have called it Foreign Account Tax Compliance Report And Punish.

USA citizens are required to report their world wide income, it  is part of being an American citizen.  One can renounce citizenship and avoid the taxes, but a whole new set of problems kick in.

Not being a citizen is too expensive.  In many ways.

HaileyinHongKong wrote:

Not being a citizen is too expensive.  In many ways.

Could not agree more.