Foreign Account Tax Compliance Act (FATCA) Assessment & Compliance Planning

FATCA Impact Assessments & Compliance Planning

The United States, in response to the Swiss bank account scandal and to increase global tax transparency, enacted the Foreign Account Tax Compliance Act (“FATCA”). FATCA has three major regulatory components including (1) individual filing requirements (a new IRS disclosure form 8938 for specified foreign assets); (2) foreign entity registration and U.S. withholding requirements; and (3) intergovernmental agreements with foreign governments. The new individual reporting requirements under FATCA create new disclosure requirements for individuals with foreign bank accounts and other foreign investments. It is important for you to understand these new reporting requirements and ensure that your tax professional is aware of all of your foreign investments to ensure proper and timely disclosures. Contact the attorneys at Terrence A. Grady & Associates Co., LPA to determine whether you are in current compliance and what options are available to you to correct any previous filing delinquencies related to the new FATCA disclosure form.

In addition to the onerous individual reporting requirements under FATCA, there is also a whole regulatory component for foreign entity registration and withholding requirements for U.S. withholding agents. These foreign entity registration requirements require specific foreign entities to register with the IRS and enter into an agreement to report information regarding their U.S. accounts. The new tax law is very complex regarding who is required to register and the consequences for failing to comply under FATCA.

In addition to the very significant regulatory scheme for foreign entity registration, FATCA imposes very significant tax withholding and reporting obligations on U.S. withholding agents who are making payments to foreign entities. Any U.S. businesses with foreign operations will need to understand the impact FATCA has on its operations and ensure that it is properly documenting all offshore payments. Failure to comply with these reporting and disclosure requirements under FATCA could result in significant penalties being assessed against U.s. businesses.

The attorneys at Terrence A. Grady & Associates can provide your global business with a FATCA impact analysis that addresses all of the new regulatory requirements under FATCA and alerts you to the changes that need to be made to internal policies and procedures in order to ensure 100% tax compliance. Additionally, we can work with your business to tailor a compliance plan to ensure that all record retention requirements under FATCA are implemented in your business structure and that your accounts payable function understands the withholding obligations for offshore payments.

Contact our FATCA Tax Attorneys

The Foreign Account Tax Compliance Act imposes a variety of new disclosure, reporting, and registration requirements on U.S. and foreign individuals and businesses. Failure to comply with these new regulatory requirements could result in very serious penalties and fines against you and/or your business. Contact our FATCA tax loss specialists to assist you in understanding the new tax law and your requirements and the impact it has on you and your business.