As part of Fatca (The Foreign Account Tax Compliance Act), a tax-evasion-detection program enacted in 2010, the following announcement of a new program to detect and thwart illegal tax avoidance has significant impact on foreign accounts. You can view this article in it's entirety, and a list of countries eligible to receive information from the IRS about their taxpayers’ U.S. accounts, here.
The Internal Revenue Service has kicked off a new program under which it shares large amounts of individuals’ financial-account information with certain foreign countries, the agency said Friday.
The IRS said it received digital information about U.S. taxpayers’ foreign accounts from governments and firms around the world, and it sent information on foreigners’ U.S. accounts to government authorities in as many as 34 countries. While governments have exchanged such information in the past, the sharing wasn’t automatic and the scope was often far narrower. The deadline for the exchange to begin was Sept. 30.
“This groundbreaking effort has fundamentally altered our relationship with tax authorities around the world, giving us all a much stronger hand in fighting illegal tax avoidance and leveling the playing field,” IRS Commissioner John Koskinen said in a news release.
The Internal Revenue Service has kicked off a new program under which it shares large amounts of individuals’ financial-account information with certain foreign countries, the agency said Friday.
The IRS said it received digital information about U.S. taxpayers’ foreign accounts from governments and firms around the world, and it sent information on foreigners’ U.S. accounts to government authorities in as many as 34 countries. While governments have exchanged such information in the past, the sharing wasn’t automatic and the scope was often far narrower. The deadline for the exchange to begin was Sept. 30.
“This groundbreaking effort has fundamentally altered our relationship with tax authorities around the world, giving us all a much stronger hand in fighting illegal tax avoidance and leveling the playing field,” IRS Commissioner John Koskinen said in a news release.
Under Fatca, foreign banks and financial firms must provide account information for U.S. taxpayers to the IRS. If the firms don’t comply, they and their account holders, even those with no U.S. connection, could be docked 30% of payments such as interest and dividends from U.S. sources. Financial firms in many countries submit this required information to the government, which then sends it to the IRS.
Earlier this month, the Treasury Department said that it would delay until 2019 the 30% withholding provision for many types of transactions, such as stock trades. It has already begun on some other types of payments.
After Fatca was enacted, some countries expressed interest in receiving financial account information about their residents from the U.S., and U.S. authorities authorized such exchanges through bilateral agreements.
In addition, the OECD countries opted to follow Fatca by developing a similar protocol for the automatic exchange of account data. Although not yet fully implemented, the OECD’s “common reporting standard” is expected to be similar to Fatca’s, in a bid to ease information exchange among countries.
The IRS said it received digital information about U.S. taxpayers’ foreign accounts from governments and firms around the world, and it sent information on foreigners’ U.S. accounts to government authorities in as many as 34 countries. While governments have exchanged such information in the past, the sharing wasn’t automatic and the scope was often far narrower. The deadline for the exchange to begin was Sept. 30.
“This groundbreaking effort has fundamentally altered our relationship with tax authorities around the world, giving us all a much stronger hand in fighting illegal tax avoidance and leveling the playing field,” IRS Commissioner John Koskinen said in a news release.
The Internal Revenue Service has kicked off a new program under which it shares large amounts of individuals’ financial-account information with certain foreign countries, the agency said Friday.
The IRS said it received digital information about U.S. taxpayers’ foreign accounts from governments and firms around the world, and it sent information on foreigners’ U.S. accounts to government authorities in as many as 34 countries. While governments have exchanged such information in the past, the sharing wasn’t automatic and the scope was often far narrower. The deadline for the exchange to begin was Sept. 30.
“This groundbreaking effort has fundamentally altered our relationship with tax authorities around the world, giving us all a much stronger hand in fighting illegal tax avoidance and leveling the playing field,” IRS Commissioner John Koskinen said in a news release.
Under Fatca, foreign banks and financial firms must provide account information for U.S. taxpayers to the IRS. If the firms don’t comply, they and their account holders, even those with no U.S. connection, could be docked 30% of payments such as interest and dividends from U.S. sources. Financial firms in many countries submit this required information to the government, which then sends it to the IRS.
Earlier this month, the Treasury Department said that it would delay until 2019 the 30% withholding provision for many types of transactions, such as stock trades. It has already begun on some other types of payments.
After Fatca was enacted, some countries expressed interest in receiving financial account information about their residents from the U.S., and U.S. authorities authorized such exchanges through bilateral agreements.
In addition, the OECD countries opted to follow Fatca by developing a similar protocol for the automatic exchange of account data. Although not yet fully implemented, the OECD’s “common reporting standard” is expected to be similar to Fatca’s, in a bid to ease information exchange among countries.
