The Path Forward: A Practical Guide for Analyzing and Implementing the Newly Proposed Foreign Account Tax Compliance Act (FATCA)
The U.S. Treasury Department and the Internal Revenue Service (IRS) have released proposed regulations on the Foreign Account Tax Compliance Act (FATCA). FATCA, which became law in 2010, requires foreign financial institutions to provide detailed information about U.S. account holders to the IRS. The law is effective on January 1, 2013. On February 8, 2012, the U.S. Treasury Department and the IRS released proposed regulations that provide financial institutions with a clearer road map, though not a final one, to compliance.
This paper provides:
- An overview of pre-existing account, new account, withholding, and reporting requirements as outlined in the provision
- Possible implications for U.S. and foreign financial institutions
- Steps to consider in addressing FATCA compliance
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