FATCA Discussion Thread (Ask your questions) Part Two
Please ask your questions here about FATCA.
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@Just Me and @tdott
Thanks for the clarification. I have also asked various people who have done streamlined and have not heard of anyone being slapped with penalties, which is why I was a bit alarmed with the talk of non-willful penalties but that doesn’t seem to apply here. In any case, if there is one thing I am sure of, it is that I will not be paying any penalties to the IRS even in the unlikely event they were to attempt to impose them, I have never worked a day of my life in the U.S. or received anything from their country and owe them nothing. Let them try to impose penalties on any of us, I am willing to never step foot in the U.S. again if need be and once people have their CLN, I don’t see what they can do to collect any illegitimate penalties.
OECD: the United States can remain a tax haven
Translated from an article in French:
http://translate.google.com/translate?sl=auto&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&u=http%3A%2F%2Fwww.lesobservateurs.ch%2F2014%2F02%2F21%2Focde-les-etats-unis-peuvent-rester-paradis-fiscal%2F
“The United States has managed to introduce a clause allowing them to avoid the new international standards for automatic exchange of information set up by the Organisation for Economic Cooperation and Development (OECD), which adheres Switzerland and made public last week.
[…] “Do not be afraid of words emphasizes Jürg Birri, head of the department of law at KPMG auditor for German-speaking Switzerland. What has been succeeded in the United States is difficult to accept. They use the specificities of their FATCA legislation to divert the new global law against tax evasion seeing the day and participate in tax evasion by non-Americans. “”
How is that acceptable to the rest of the world?
@noone, it’s obviously acceptable to the OECD as they’ve been idiotic enough to agree to it.
Thank you, noone.
This must be highlighted to our government representatives who have negotiated IGAs with the US. They are all being taken for fools if this is accepted!
@noone
I get a splash screen on that article that does NOT allow me to read it. Do you have another link or work around?
@Just Me, here is the link to the original article. I didn’t realize it was behind a paywall.
Google Translate did not work well with it.
http://www.lesobservateurs.ch/2014/02/21/ocde-les-etats-unis-peuvent-rester-paradis-fiscal/
I did not subscribe to that site, but it would be interesting to read the full article to see exactly what they’re talking about. This seems so unrealistic that I wonder if it’s just bad journalism or if the US really pulled this out. If that’s the case, then they have really good negotiators. I don’t see how this could be OK for the OECD. That defies the point of their OEOI. If anyone can hide money in the US, then bother. This whole GATCA thing only work if everyone plays by the rules – at least “civilized” countries in which people are not that afraid to save their money.
@noone
I would have liked to read that, but maybe the answer is in this quote here…
As we AND the US know:
Vice President Biden’s HOME STATE of DELAWARE IS A TAX HAVEN ( http://www.nytimes.com/2012/07/01/business/how-delaware-thrives-as-a-corporate-tax-haven.html?pagewanted=all&_r=0 ) ;
re; ” ………As for the US, the country was not judged as “totally conforming,” but only “mostly conforming” with a large part of the objections pertaining to the state of Delaware….” http://www.swissinfo.ch/eng/politics/OECD_seeks_inspiration_from_FATCA_model.html?cid=37494258
So, when will Vice President Biden and the State of Delaware be entering OVDI/P?
Or will the IRS and Treasury invent a special ‘Streamlined Compliance’ process for US States that aid and abet US and non-US tax evasion? When will the Fortune 500 incorporated in Delaware be preparing their submissions, and paying 50% of their net worth?
Or will they just get a ‘Geithner’ pass and no penalties?
@Badger…
That language, about “mostly” is GATCA “wink wink, nudge nudge, say no more…”.
http://youtu.be/ona-RhLfRfc
What is the new announcement on FATCA final regulations all about?
First, this from Accounting Today, where the IRS “official” says there is no correlation between renouncing and FATCA implementation
Self delusion and DENIAL
Then this a good explanation of what was issued followed by explanations of changes.
It is in the “Say WHAT???” category…
http://fordhamilj.org/articles/buying-fatca-compliance-overcoming-holdout-incentives-to-prevent-international-tax-arbitrage/
…”….According to some financial analysts and commentators, compliance with FATCA’s due diligence requirements poses an immense administrative burden upon compliant FFIs. This burden could be so great as to potentially drive future investment away from the United States, which would then likely fail to generate the revenue anticipated.
This Comment examines the harmful consequences that the implementation of FATCA might have, particularly as this legislation could affect the ability of the United States to induce tax haven compliance in the future…”..
…….It further analyzes the effect that FATCA might have on future tax treaties between the United States and other countries…”
Marc D. Shepsman, Comment, Buying FATCA Compliance: Overcoming Holdout Incentives to Prevent International Tax Arbitrage, 36 Fordham Int’l L.J. 1769 (2013)
More journalists looking to contact Americans overseas who are experiencing problems due to US taxation policy:
Associated Press
Adam Geller
National Writer
The Associated Press
450 W. 33rd Street
New York, N.Y. 10001
T: 212-621-6919
ageller@ap.or
USA Today Journalist Kim Hjelmgaard
khjelmgaard@usatoday
@khjelmgaard
CNN Money Journalist: Sophie Yann
Sophia Yan 嚴倩君
CNNMoney – Hong Kong
+852 3128 3247
+852 9170 9285
sophia.yan@cnn.com
My wife had an appointment with our local bank to open a deposit account for our new landlords. (Here in Germany it is common to give landlords a deposit equal to 3 months rent in case of damages, missed payments, etc.) She was asked if either of us were “US persons” and would have refused to open that account if we were.
Our bank would have refused, that is.
@notamused, Yes, sounds similar to what seems to be happening here in Switzerland. This thread was posted a couple of days ago over on the English Forum website:
http://www.englishforum.ch/housing-general/201608-please-help-rent-deposit-account-special-forms-us-citizen.html
I’ve no doubt that if she refused to sign the W-9 the rental of the flat would fall through because the bank won’t open an account for them.
2 interesting articles today:
Political backlash over privacy could come as tax evasion reform (FATCA) speeds up.
http://www.ibtimes.com/political-backlash-over-privacy-could-come-tax-evasion-reform-fatca-speeds-1557585
Note the denial about account closure, reported as anecdotal:
“Republicans and other lawmakers have also noted anecdotal reports of overseas Americans losing banking services because of FATCA, though there is little data on the extent of the phenomenon.”
Just ask Americans living in Switzerland or Germany!
And this one:
US IRS starts new initiative to target unreported Indian accounts
http://economictimes.indiatimes.com/news/nri/nri-tax/us-irs-starts-new-initiative-to-target-unreported-indian-accounts/articleshow/30996115.cms
“Nicholas Connors, a supervisory revenue agent with the IRS small business/self employed division stated that the IRS will soon “begin examining US taxpayers suspected of holding undeclared accounts in Indian banks”.
Connors stated that the IRS has received information on accounts from Indian banks. There are 100 Indian bank account cases that the IRS is sending out for examination (also known as audit) across the country. “I think California, because of the large Indian population, is going to get more than its fair share of cases,” Connors said.
“Within the Northern California/Bay Area, we’re [the IRS Northern California/Bay Area office] scheduled to pick up 30 or 40 of those.” Connors further add .. ”
I wonder if it is the result from OVDI data mining…
This is getting better and better: now foreign companies to automatically withhold taxes from US persons employee and send it to the IRS:
Cathay to withhold US pilots’ wages for taxes
http://www.scmp.com/business/companies/article/1438783/cathay-withhold-us-pilots-wages-taxes
????????
‘Cathay to withhold US pilots’ wages for taxes; Airline says new laws are forcing it to hand over 30 per cent of salaries to American authorities’
PUBLISHED : Monday, 03 March, 2014, 2:59am
“…At the centre of the controversy are two US tax regulations – an income tax withholding requirement in the Internal Revenue Code and the Foreign Account Tax Compliance Act….”
…He said it was “strange” that the tax authorities had demanded airlines declare pilots’ financial details because airlines were not financial institutions.
Two American pilots employed by Cathay said the plans would create cash-flow problems for them. They also said that filing tax was a complex matter and they were concerned they might pay more than they should.
This article appeared in the South China Morning Post print edition as Cathay to withhold US pilots’ wages for taxes.”
from http://www.scmp.com//business/companies/article/1438783/cathay-withhold-us-pilots-wages-taxes (try cached version, text-only if you have difficulty getting it to load).
FATCA — Hunting for Expats
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If there is someone here who does Facebook please post a comment on and, if possible, a link to C3f on today’s SCMP Cathay airline article. There are around 500 American pilots who are affected and if they read that article some of them might just make a donation.
http://www.scmp.com/business/companies/article/1438783/cathay-withhold-us-pilots-wages-taxes
I posted this elsewhere, but might be a good one to forward to Conservative MPs. Thanks to the Harper government, the FATCA IGA they signed is making international news – of the negative kind:
http://news.co.cr/fatca-puts-canada-and-costa-rica-in-the-irs-pockets/33627/
‘FATCA Puts Canada and Costa Rica in the IRS Pockets’
Posted by Jaime Lopez on March 6, 2014 in Business News, Costa Rica News, Guanacaste News
Canada’s IGA criticized in Costa Rica.
Opportunity to comment only with FB.
All the Banksters in the non-US world are reading from the same script re FATCA. This is from Cambodia;
http://kimedia.blogspot.ca/2014/03/us-applies-scrutiny-on-tax-abroad.html?showComment=1394063998003
“……in the interest of continuity and consistency, the banking association prefers if the Royal Government takes the lead in dealing with the US authorities,”….
FATCA and credit cards…just wondering, is there anything about credit cards in FATCA. I wonder about keeping a positive balance in a credit card account. I do this as a practical matter as I only have one bank account transaction monthly to the credit card, which saves on fees. In effect, I keep cash in my credit card account before I spend it. Would that be considered a deposit account?
@Petit Suisse
Page 31 of the Canadian FATCA IGA is quoted below. With the “Unless the Reporting Canadian Financial Institution elects otherwise” disclaimer, who knows?
I should say that I still don’t understand what “entities” and “entity accounts” are, as in my quote above.