Treasury and IRS Issue Final FATCA Regulations
By Frank Byrt
Talking Points from AICPA
Kristin Esposito, the AICPA's technical tax manager, told AccountingWEB that the greatest reporting burden stemming from FATCA will be on foreign banks, although US CPAs and accountants with clients with foreign holdings need also be aware of the reporting requirements, as should some US-based banks with foreign operations.
- Identify US accounts.
- Report certain information to the IRS regarding US accounts.
- Instead of reporting to the IRS directly, some FFIs can also report account data to their own government, which will then report that information to the IRS.
- Withhold a 30 percent tax on certain US-connected payments to nonparticipating FFIs and account holders who are unwilling to provide the required information.
- Delay withholding or reporting effective dates in several cases to provide temporary or transitional relief.
- Coordinate the new rules set forth in the final regulations with the rules in FATCA-related agreements being negotiated with other jurisdictions ("intergovernmental agreements," or IGAs).
- Provide certainty and clarity by superseding all of the previous FATCA guidance issued by the US Treasury Department.
- Adopt changes in phrasing and structure intended to clarify the rules in the final regulations.
- Provide registration and compliance procedures for groups of financial institutions that hold commonly managed investment funds with US participants.
- Combating Offshore Tax Evasion, Implementing FATCA
- Treasury Department Unveils Model FATCA Agreement