It goes into effect July 1, 2014. Countries that have signed FATCA agreements with the U.S. include those that have historically been considered offshore financial centers like Switzerland and The Cayman Islands. Many other traditional offshore banking countries are currently in the process of implementing FATCA agreements. The end of “bank secrecy” and the march toward “global transparency” is here. All U.S. citizens, Green Card holders or tax residents with financial accounts abroad need to review their accounts to ensure proper reporting. If you haven’t been reporting, seek competent advice from a CPA or tax attorney that specializes in U.S. international taxation. The IRS offers a Voluntary Disclosure Program to report foreign accounts without facing criminal prosecution. While the penalties assessed can be substantial, the penalties assessed outside the program, as well as the prospect of criminal prosecution, are far worse.
*Pursuant to requirements relating to practice before the Internal Revenue Service, any tax advice in this communication is not intended to be used, and cannot be used, for the purpose of (1) avoiding penalties imposed under the United States Internal Revenue Code, or (2) promoting, marketing, or recommending to another person any tax-related matter.
ABOUT THE AUTHOR
› Richard A Reed, CPA, M. Tax, is a Principal at Lancaster & Reed PLC who focuses on U.S. & International tax practices. He can be reached at 305.361.1014 or Lancaster-CPAS.com.
With offshore banking gone as a way to protect assets, what other (legal) options do investors have to shelter their hard-earned dollars?
Text by Dena Roché
The financial vehicle known as Grantor Retrained Annuity Trust, or GRAT, is used to make large financial gifts to family members without paying a gift tax.
Family Limited Partnerships, or FLPs, are created to move wealth from one generation to the next with favorable tax implications.
A tax-exempt bond fund with a viable yield is not subject to income tax or the additional 3.8% Obamacare tax on Net Investment Income.