Professor Allison Christians of McGill University has published in the July 9, 2012 issue of International Tax Notes an excellent article on FBAR and FATCA filing. Professor Christians has not only put a spotlight on the overreach of the United States through its required reporting of FBAR and FATCA by Americans overseas, but has also proposed a constructive legal solution to end this reporting requirement. All Americans abroad will be interested in reading this article.
Allison Christians seems to have used quite a bit of actual common sense in coming to her conclusions / suggestions. Perhaps a way for a Win:Win? At any rate, a good read and, although reprinted from TAX NOTES INTERNATIONAL, JULY 9, 2012, p. 157, Volume 67, Number 2, July 9, 2012*, I haven’t come across this before. I may have missed it here at Isaac Brock.
*Tax Analysts 2012. All rights reserved. Tax Analysts does not claim copyright in any public domain or third party content.
The title of this column asked whether a same country exception could serve to focus FATCA and FBAR. The answer seems to be yes for pragmatic reasons, by allowing the tax administration to turn its ever-diminishing enforcement resources away from what is likely to produce an enormous data dump with few productive leads — getting some of the haystack out of the way in order to render the needle more visible. The answer also seems to be yes for political and diplomatic reasons. FATCA and FBAR are either a rather nasty piece of arm-twisting, a bit of bad faith in the U.S. diplomatic relations department, or, worse, they are signaling a loss of faith in the pursuit of cooperation through diplomacy — a huge blow to the international tax regime as a whole. Carving out the bona fide residents who are using bank accounts to live their lives as residents and often dual citizens abroad could provide a means of backing away from either of these destructive positions.