Navigating Data for FATCA
Foreign Account Tax Compliance Act
Taking yet another step towards the goal of addressing offshore accounts reporting, the Foreign Account Tax Compliance Act (“FATCA”) will impose a 30% withholding tax on most types of U.S. source income and any gross proceeds from the sale or disposition of U.S. property that can produce interest or dividends unless a non-US financial institution (referred to as an FFI) enters into an agreement with the IRS to report all U.S. investors.
Enacted on 18 March 2010, FATCA has extensive ramifications affecting the commercial basis on which non-U.S. financial institutions hold U.S. assets and deal with U.S. clients and investors. While regulations are yet to be drafted to give practical effect to the legislation which applies to payments made after 31 December 2012, the support for this law dates as far back as the 2007 Stop Tax Haven Abuse bill co-sponsored by the then Senator Obama.
Learn more by reading, "Wanted: U.S. Persons: How Can You Be Sure You Have Identified Them All?", available for download below.