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FATCA Discussion Thread (Ask your questions) Part Two

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Please ask your questions here about FATCA.

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NB: This discussion is a continuation of an older discussion that became too large for our software to handle well.  See FATCA Discussion Thread (Ask your questions) for earlier discussion.

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3,498 thoughts on “FATCA Discussion Thread (Ask your questions) Part Two”

  2. What should I believe about the “effective FATCA date”? At this point I have no idea which way the FATCA delay door will swing.

    OPEN???
    http://www.usa-tax-news.com/story/IRS_Advisers_Recommend_Delaying_FATCA_To_2015____62988.html#.Uq3YWVzH9yo.twitter

    or CLOSED???
    http://www.fsitaxposts.com/2013/12/13/u-s-treasury-delay-fatca-effective-date/

    I wonder what James Jatras has been up to lately? I wonder which way he thinks this might go?

    Making an effective start date for FATCA come in the middle of the year (AND on Canada Day no less — very in our face and antagonizing) adds another layer to the lunacy.

  4. @ bubblebustin
    Works for me! After that let’s pick a date for the death of CBT. I like July 1, 2014 — Canada Day or then it would also be Free from USA Day.

  5. Sounds good, Em, but for many the day that they renounce/relinquish US citizenship is Free from USA Day! Did you realize that the FATCA Fact Finding Forum was held a year ago today?

  6. Carl Levin (father of FATCA) wants to bankrupt Americans living abroad in order to help bailout his own failed state:

    Levin Statement on Detroit Filing for Chapter 9 Bankruptcy Protection
    Thursday, July 18, 2013

    WASHINGTON – Sen. Carl Levin, D-Mich., said the following today:

    “Detroit is more than a part of the state I represent in Washington. It is my lifelong home. And so today’s news that the city has filed for bankruptcy protection saddens me, however necessary it may have been. But what stands out about Detroit through the centuries is its grit and resilience. I know firsthand, because I live in Detroit, that our city is on the rebound in some key ways, and I know deep in my heart that the people of Detroit will face this latest challenge with the same determination that we have always shown.”

    http://www.levin.senate.gov/newsroom/press/release/levin-statement-on-detroit-filing-for-chapter-9-bankruptcy-protection/

  8. I SO wish I could send this person to Brock:

    “I am u.s. citizen, and I live and bank in Ukraine. Ive never reported my bank account to IRS. Coming in to compliance is not an option as the penalties/interest would leave me living on the street, bankrupt.

    My account has less than 50k, so I hope it is not reported to the IRS. If it is, how much teeth does FATCA have? Will IRS bully my Ukrainian bank into handing over my balance to them, or witholding 30% of my transactions? (I am disabled, and I live on the interest of my balance and $600 a month that is wired to me from the U.S. Would this $600 be in jeopardy if my account is declared recilacitrant? Ukrainian banks pay between 18-24% interest on deposits in local currency.)”

    http://www.avvo.com/legal-answers/will-fatca-wipe-out-my-income-and-savings–1526653.html

  10. @ bubblebustin
    Yet another heart breaking story. Hopefully that person will find his/her way to Brock. It does pop up almost everytime you search FATCA. The only advice that site will offer is the get-thee-to-an-attorney advice, complete with disclaimers about that advice.

  11. Why do I always read news about FATCA and Russia right before bedtime?

    December 16, 2013, IExpats: Russia Will Sign FATCA Deal With US Within Weeks

    Dmitry Medvedev has instructed the Russian Finance Ministry and central Bank to stop dilly-dallying over the international tax law and agree terms with the US by January 20, 2014.

    A draft treaty will ensure Russia’s Federal Tax Service collects FATCA data from banks and other financial institutions for transmission to the US Internal Revenue Service.

    Many leading Russian politicians and economists baulked signing a FATCA deal with Washington on the basis that the US was interfering with the nation’s internal financial regulations.

    Medvedev seems to have had enough of the bickering and has put an end to the protests with his directive.
    Tax network

    Not joining FATCA would have seen Russia’s banks directly signing up for FATCA, which would breach the country’s privacy and data protection laws. No doubt the government views joining FATCA as easier than fighting the opposition to change law.

    Russia is a big scalp for the US Treasury to hang on its FATCA belt.

    After a year or more of will they, won’t they uncertainty over a number of financial jurisdictions, most are caving into pressure from the US, Europe and the Organisation of Economic Co-Operation and Development (OECD) to sign up to FATCA.

    Besides Russia, Canada, Switzerland and the Asia Pacific finance centre of Singapore have all relented and indicated they will join the tax network.

    Only one comment thus far:

    Another ‘watered down’ FATCA IGA so the US can claim it’s got another country. What will be exempt? Pensions, tax free accounts backed up by low fines if a Russian bank cocks up? Again it’s about establishing the principle rather than the law that will come later when things are tightened up.

  13. Abuse of personal information – including the SSN, is apparently widespread now:
    http://www.nytimes.com/2013/12/16/business/international/ikea-employee-spying-case-casts-spotlight-on-privacy-issues-in-france.html?pagewanted=1&src=recg
    from ‘Revelations That Ikea Spied on Its Employees Stir Outrage in France’:
    ….”The company was said to have provided a private detective with her Social Security number, personal cellphone number, bank account details and other personal data. …”…..
    …”included a startling attachment: scanned images from Ms. Paulin’s passport,…”

  19. American Bankers – recent letters and comments on FATCA (and Dodd Frank):
    http://www.aba.com/search-center/Pages/results.aspx?k=fatca&PF=1&r=write%3E%3D%2212%2F18%2F2013%22

    note that they call FATCA the Foreign ACTIVITY Compliance Act;
    ‘ABA’s Position’
    “ABA supports legislation that will ensure that all U.S. citizens and residents pay their fair share of taxes, and thus, prevent loss of millions of dollars by the U.S. because of taxpayers that engage in illegal use of offshore accounts to hide taxable income. However, we believe that FATCA is so broad in scope and application that it pulls in entities and activities that are not the intended target of the legislation. ”
    http://www.aba.com/Issues/Index/Pages/Issues_ForeignActivityTaxComplianceAct.aspx

  20. The FATCA mega-data collection proceeds, yet, the IRS can’t cope with the tasks it already has – plus processing Obamacare.

    The GAO warns that services (already a problem for the IRS) may have to be further cut:
    …”In the face of similar trends, last year GAO reported that a dramatic revision in IRS’s taxpayer service strategy was needed and recommended IRS take steps to better balance demand for services with available resources. GAO acknowledged this may require IRS to consider difficult tradeoffs, such as limiting some services. In response, IRS has proposed eliminating or reducing some services for 2014 such as answering basic tax law questions only during the filing season. …”… http://www.gao.gov/products/GAO-14-133 ‘IRS Needs to Do More to Address the Growing Imbalance between the Demand for Services and Resources’
    GAO-14-133, Dec 18, 2013

  21. The IRS will doggedly pursue but can’t explain how they assessed US taxes – superimposed on top of already post-CRA taxed Made-and-saved-in-Canada total income under $6,000. but they can’t keep track of 589 MILLION owed to the IRS by the vendors they deal with?

    …”Altogether, 1,168 IRS vendors owed back taxes totaling $589 million as of July 2012, according to the report released Tuesday. Only 50 were in a payment plan to pay off their debt.

    “When the IRS conducts business with vendors that do not comply with federal tax laws, it conveys a contradictory message in relation to its mission to ensure compliance with the tax laws,” said J. Russell George, Treasury inspector general for tax administration….”…

    Yeah, you bet. And ‘contradictory’ isn’t the word I’d use.

    See also:
    http://www.timescolonist.com/business/irs-contracted-with-1-200-vendors-that-owed-back-taxes-including-1-owing-525-million-1.762573
    http://www.nola.com/politics/index.ssf/2013/12/irs_vendors_owe_million_in_bac.html

  22. The IRS has prepared the software exchange method to implement DATCA—giving Domestic bank data from USA to foreign governments, in return for Intergovernmental Agreements which are not ratified by Congress.

    When did Congress vote on that? (p.s., they didn’t)
    How much did that cost?
    How did that effect the budget over-runs?
    Who gets to make new laws in DC that regard all of USA’s banks?
    Is USA ready to send over uncontrolled personal and private information to foreign governments?

    http://www.irs.gov/Businesses/Corporations/International-Data-Exchange

  25. it uses “fatca schema” in the description — Schema is a Swedish word meaning “scheme” or, more loosely, “format”. So, it could be that they’ve outsourced the development of the FATCA portal in part to a Swedish IT firm.

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