Yearly Archives: 2012

When will the fools wake up and repeal FATCA?

Thanks to low domestic savings rates and profligate government spending, the U.S. economy is reliant on continuous influxes of foreign investment to provide the capital necessary for growth. Yet no doubt thanks in part to FATCA, foreign direct investment in the US for the first half of 2012 declined by 39.2% over the prior year, and China surpassed the US as the world’s largest recipient of global foreign direct investment for the first time since 2003.

Coerced Foreign Tax Compliance Is Killing American Jobs

Wow, they got a really BIG and I mean BIG country to sign on.

http://www.fsitaxposts.com/wp-content/uploads/2012/11/US-Denmark-IGA-model-1.pdf

Agreement is very similar to that of the UK except:

1. Small Financial Institutions with Local Client Base

A Danish Financial Institution that meets all of the following requirements:

a. The Financial Institution must be licensed and regulated under the laws of Denmark;

b. The Financial Institution must have no fixed place of business out-side Denmark;

c. The Financial Institution must not solicit account holders outside Denmark. For this purpose, a Financial Institution shall not be consid-ered to have solicited account holders outside of Denmark merely be-cause it operates a website, provided that the website does not specifi-cally indicate that the Financial Institution provides accounts or ser-vices to nonresidents or otherwise target or solicit U.S. customers;

d. The Financial Institution must be required under the tax laws of Denmark to perform either information reporting or withholding of tax with respect to accounts held by residents of Denmark;

e. At least 98 percent of the accounts by value provided by the Finan-cial Institution must be held by residents (including residents that are entities) of Denmark or another Member State of the European Union;

f. Subject to subparagraph 1(g), below, beginning on January 1, 2014, the Financial Institution does not maintain accounts for (i) any Speci-fied U.S. Person who is not a resident of Denmark (including a U.S. Person that was a resident of Denmark when the account was opened but subsequently ceases to be a resident of Denmark), (ii) a Nonpartic-ipating Financial Institution, or (iii) any Passive NFFE with Control-ling Persons who are U.S. citizens or residents;

g. On or before January 1, 2014, the Financial Institution must im-plement policies and procedures to monitor whether it provides any account held by a person described in subparagraph 1(f), and if such an account is discovered, the Financial Institution must report such ac-count as though the Financial Institution were a Reporting Danish Fi-nancial Institution or close such account;

h. With respect to each account that is held by an individual who is not a resident of Denmark or by an entity, and that is opened prior to the date that the Financial Institution implements the policies and pro-cedures described in subparagraph 1(g), above, the Financial Institu-tion must review those accounts in accordance with the procedures de-scribed in Annex I applicable to Preexisting Accounts to identify any U.S. Reportable Account or account held by a Nonparticipating Finan-cial Institution, and must close any such accounts that were identified, or report on such accounts as though the Financial Institution were a Reporting Danish Financial Institution;

i. Each Related Entity of the Financial Institution must be incorpo-rated or organized in Denmark and must meet the requirements set forth in this paragraph; and 33

j. The Financial Institution must not have policies or practices that discriminate against opening or maintaining accounts for individuals who are Specified U.S. Persons and who are residents of Denmark.

In one regard this announcement is relatively good news as I have had suspiscions they were intending to make announcement at the end that they signed with 50+ countries. Instead it looks like they are going out with announcements in dribs and drabs. It is still in my opinion weird for Denmark to be signing prior to lets say Germany.

This is pretty pathetic but I wanted to post it.

http://www.fco.gov.uk/resources/en/pdf/3706546/594588382/716347982/TrEmUSANo12012FACTA

I don’t know if I can say anything else at the moment it is a very poorly written document basically competely focused on the problems facing financial institutions.

ACA: “SHE’S DONE IT AGAIN! Nina Olson, Taxpayer Advocate within the IRS, has issued her semi-annual report to Congress. Lucidly written and comprehensible by laypeople, it’s an eye-opening read. Significant space is given to problems of Americans

US and China could play “fiscal chicken” under FATCA

This month the IRS released a list of 50 countries that are on the road to signing an IGA – either finalising models for IGAs, engaged in dialogue for pursuing an IGA or conducting initial negotiations. China was not on the list as being at any level of negotiation with the IRS. This is significant, according to Dan Niedle, a London-based tax partner at law firm Clifford Chance.

“The interesting question about the list is who’s not on it at all. And China is the obvious one,” he says. “There are lots of rumours. Early on it was reported that China might just ban its financial institutions from taking part and dare the US to impose withholding taxes.”

Again this re-iterates the need for Canada and other countries not to enter into IGA’s.

How bad is it?

Once Again—Death of the Liberal Class

Alberta to recruit American war vets to work in oilsands

The question is — with working in Canada for long periods of time, what are tax return and reporting responsibilities for these workers — both for Canada CRA and US IRS?

CALGARY— Alberta is seeking to recruit an army of oilsands workers — literally.

The province is on the march to attract thousands of demobilized U.S. military personnel to help develop what’s been touted as Canada’s economic engine for coming decades, the oilsands.

The project’s success would also act as a goodwill gesture for Canada’s controversial oilsands, said Alberta Energy Minister Ken Hughes.

“We’re trying to understand how we could produce employment opportunities for American service people returning from overseas,” Hughes said Friday. “I’ve detected some interest in the States.”

The mission has attracted the attention of U.S. Ambassador to Canada David Jacobson and the encouragement of the U.S.’s former consul general in Calgary, Laura Lochman, said Hughes.

Hughes said there are a half-million unemployed or underemployed younger military veterans in the U.S. — a force that could be tapped to satisfy a chronically-hungry energy industry in Alberta.

. . .