Expat Forum For People Moving Overseas And Living Abroad banner

1 - 3 of 3 Posts

·
Registered
Joined
·
1,021 Posts
Discussion Starter #1 (Edited)
The DA "FBAR/FATCA Task Force" (which as far as I know is not a force and has no task) has posted some comments on the DA website at FBAR/FATCA Task Force Report - Democrats Abroad

From the FATCA bit:
The House Ways & Means Committee has scheduled a hearing on FATCA on April 26th. The witness list includes one Democrat (we don’t know who yet) but the rest are Republicans, including some of the appellants in the FATCA lawsuit (more below) and ...[lawyer James Bopp]. We are working through Congresswoman Maloney’s office to get onto the witness list.

The FATCA Lawsuit (challenging the constitutionality of the law) is in the appeals court. Oral arguments were heard in late January. No further proceedings or rulings have been published since then. The appellants’ proceedings include no further arguments than those included in the original filings. The success of the appeal does not appear to be any better than the original suit.
[..]
We understand the European Union is sending a delegation to Washington to discuss the reciprocity inherent in the IGAs.
[..]
The FATCARepeal.com (set up to raise money to fund the FATCA lawsuit) people have teamed up with the long-time FATCA critics at deVere financial advisors to form a lobby group working steadily to raise money and advocate for repeal on the Hill.
Also comments on the most recent American Citizens Abroad proposal for Residence Based Taxation.

From the FBAR bit:
As you may know, Americans with accounts in foreign financial institutions with a total balance across all accounts at any point during the year of $US10,000 or more need to file a FBAR (Foreign Bank and Financial Accounts Report) Form 114.
[..]
The form is filed with Treasury, rather than the IRS, with FinCen - the Financial Crimes Enforcement Network. (To say that it disturbs Americans abroad that we need to make this voluntary disclosure to the section of the US Treasury set up to investigate and apprehend perpetrators of financial crimes would be the understatement of the decade....)

Many Americans living abroad know nothing of their obligation to report to the IRS the earnings they make in their country of residence. Even fewer know that they are obliged to report their financial accounts if the aggregate account balances exceed the reporting threshold. The Form 114 provides a space for new FBAR filers to make this claim. The penalties for failing to file an FBAR report can be highly punitive, as this reporting [Pomerantz case, see http://www.expatforum.com/expats/ex...canadian-resident-wilful-fbar-penalties.html] ] from this week notes. The taxpayer in this article filed a tax return but not a FBAR.

Americans abroad who don't file a Form 1040 may no longer feel safe hiding from the IRS "in the shadows," because their bank's FATCA filings may be used by the IRS to identify them as out of compliance with their tax filing obligations. The good news in this piece is that the IRS admits it lacks the resources to prosecute every non-compliant tax filer. Further, the article suggests that Americans in Canada may be protected because the IRS has a limited ability to collect penalties in Canada.
(Actually, as far as I can see the IRS has only a limited ability to collect penalties anywhere beyond the US borders.)
 

·
Registered
Joined
·
1,021 Posts
Discussion Starter #2
The EU delegation, mentioned above, has made its visit and published its report:

EU-US trade and investment relations
Effects on tax evasion, money laundering and tax transparency

Executive summary


The United States of America (USA) is seen as an emerging leading tax and secrecy haven for rich foreigners. By resisting new global disclosure standards, it provides an array of secrecy and tax-free facilities for non-residents at federal and state levels, notably in Nevada, Delaware, Wyoming, and South Dakota. This Ex-Post Impact Assessment shows that:

1. In general, trade and investment relations between the European Union (EU) and the United States (US) do not seem to have impacted on US efforts to combat tax evasion, strengthen anti-money laundering legislation and its implementation, and boost tax transparency.

2. The EU and US economies have never before been as intertwined as they are today, especially in the fields of financial services, telecommunications, network industries, advertising, computer services and other related activities. The two economies together generate nearly half of the world’s gross domestic product and over 30% of global trade (2014). The USA is the EU’s top partner in trade in goods and they are also each other’s most important commercial partners and major growth markets for trade in services and related foreign direct investment.

3. The EU is aiming to establish a framework for regulatory cooperation on financial services in the EU-US Transatlantic Trade and Investment Partnership (TTIP). To date, despite some results in the negotiations, achievements have been below expectations. Moreover, money laundering, tax evasion and tax transparency are not mentioned in the TTIP Section on Trade in Services, Investment and E-Commerce.

4. Unlike virtually all of the other developed countries in the world, the USA has not signed up to the OECD’s Common Reporting Standard. It has, nonetheless, developed a robust framework of international agreements addressing international double taxation, tax fraud and other tax-related crimes. In accordance with the OECD model, the USA has signed tax treaties with all EU Member States, except Croatia. A provision establishing the exchange of information between competent tax authorities is included in all modern US tax treaties.

5. The US Congress enacted the Foreign Account Tax Compliance Act (FATCA) in 2010 to target non-compliance by US taxpayers using foreign accounts. To date, the USA has signed FATCA Intergovernmental Agreements (IGAs) with all EU Member States, except Greece, to implement the FATCA regulation. US mechanisms in place allow for effective exchange of information, and information exchange partners have indicated general satisfaction with this programme. However, the effectiveness of US information exchange on beneficial ownership has raised concerns.

6. According to the 2016 Financial Action Task Force (FATF) report, the United States has overall developed a robust legal framework to address money laundering activities and combat the financing of terrorism. Shortcomings remain in relevant sectors: privacy issues raised by some EU Member States, the generally unsatisfactory US information exchange system with regard to beneficial ownership and to designated non-financial businesses and professions, and challenges in facilitating cross-border exchange of information and enforcement of internal controls and foreign branches and subsidiaries.
http://www.europarl.europa.eu/RegData/etudes/IDAN/2017/598602/EPRS_IDA(2017)598602_EN.pdf
 
1 - 3 of 3 Posts
Top