Treasury to Treat Jurisdictions with FATCA Agreements in Substance as Agreements in Effect to Prepare for Start of Law

The Treasury Department and the Internal Revenue Service (IRS) announced that more jurisdictions will be treated as having intergovernmental agreements (IGAs) under FATCA.

Here are some excerpts from the Treasury Department Press Release – April 2, 2014

Today, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) announced that jurisdictions that have reached agreements in substance with the United States on the terms of intergovernmental agreements (IGAs) under the Foreign Account Tax Compliance Act (FATCA) can be treated as having agreements in effect until the end of 2014. This treatment will be available to jurisdictions that reach agreements in substance prior to July 1, 2014, and that consent to having the status of their agreements disclosed. As an increasing number of jurisdictions reach agreements in substance, today’s announcement provides foreign financial institutions (FFIs) located in these jurisdictions with the guidance they need prior to the upcoming registration deadlines.

“With 45 countries now considered to have IGAs in effect, and more jurisdictions far along in the process, the robust international support behind FATCA is undeniable,” said Deputy Assistant Secretary for International Tax Affairs Robert B. Stack. “Today’s announcement both adds to our global effort against tax evasion and provides crucial clarity for financial institutions as they prepare to comply with FATCA starting on July 1.”

Prior to this notice, FFIs were required to register by April 25, 2014 to ensure that they would be included on the first IRS FFI list. This is the only list that will be published before withholding begins. Today’s announcement provides the assurance that FFIs will be included on this list if they submit a complete registration form by May 5, 2014, instead of April 25 as originally announced.

 

Read the full press release.

For the IRS announcement, click here.

For the list of jurisdictions that are treated as having an IGA in effect, click here.

For more FATCA resources, please visit the Boston Tax Attorney Blog’s Offshore Tax Evasion page.

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