What is the purpose of the Foreign Account Tax Compliance Act?
What is the purpose of the Foreign Account Tax Compliance Act?
The Foreign Account Tax Compliance Act (FATCA) is a 2010 United States federal law requiring all non-U.S. foreign financial institutions (FFIs) to search their records for customers with indicia of a connection to the U.S., including indications in records of birth or prior residency in the U.S., or the like, and to …
What is the objective of FATCA?
FATCA aims to detect and discourage offshore tax evasion by U.S. citizens or U.S. residents by requiring financial institutions to identify and report accounts held by U.S. persons.
What is the intent in FATCA regulation?
The objective of FATCA is to detect, deter, and discourage offshore tax evasion by U.S. citizens or residents by requesting information about U.S. persons to increase transparency for the U.S. Internal Revenue Service (IRS) and imposing a withholding tax where the applicable documentation and reporting requirements are …
What is a reportable account under FATCA?
The term “Indian Reportable Account” means a Financial Account maintained by a Reporting US Financial Institution if: (i) it is a Depository Account which is held by an individual resident in India, and receives more than $10 as interest in any given calendar year; or.
What is Foreign Tax Compliance Act?
Foreign Account Tax Compliance Act (FATCA) What is the ‘Foreign Account Tax Compliance Act (FATCA)’. The Foreign Account Tax Compliance Act (FATCA) is a tax law that compels U.S. citizens at home and abroad to file annual reports on any foreign account holdings.
Who needs to report Foreign Assets Under FATCA?
Under FATCA, certain U.S. taxpayers holding financial assets outside the United States must report those assets to the IRS on Form 8938, Statement of Specified Foreign Financial Assets. There are serious penalties for not reporting these financial assets (as described below).
What does FATCA stand for?
FATCA stands for the Foreign Account Tax Compliance Act. It is a new piece of legislation to help counter tax evasion in the US.
Do you need to comply with FATCA?
Yes, all Financial Institutions in participating countries are required to be compliant with FATCA and CRS. I need help completing the form. While completing your self-certification form you will be able to access our User Guide. Alternatively, please contact your tax advisor