See other Business/Finance Articles
Title: US taxes and FATCA: 'The time for hiding is over'
Source:
The Local - CH
URL Source: http://www.thelocal.ch/20160126/hid ... fatca-get-compliant-fbar-tlccu
Published: Jan 26, 2016
Author: The Local
Post Date: 2016-01-26 14:48:06 by X-15
Keywords: IRS, tyranny
Views: 223
Comments: 8
FATCA. Since July 2014, the five-letter acronym has instilled dread in the hearts of American expats all around the world. “The Foreign Account Tax Compliance Act (FATCA) requires banks to report information to the IRS regarding all financial accounts held by American clients,” Ines Zemelman, expat tax specialist and founder of Taxes for Expats, tells The Local. "The age of financial privacy is over.” American citizens must report their worldwide earnings and assets to the IRS no matter where in the world they live. With the implementation of FATCA, expats who have spent years avoiding this uncomfortable truth are being reminded of it -- as well as being punished if they don’t comply. This development has led to many foreign banks trying to track down their American clients – and in some cases, lessen their own burden by simply refusing Americans service. Many expats have begun to receive a ‘FATCA Letter’ from their bank requesting certain information about their US tax status (and asking them to complete either Form W-9 or W-8). The letter usually offers a brief explanation of the FATCA legislation that requires the bank to share your name, address, and other personal details with the American tax authorities - the Internal Revenue Service. But what if you're not compliant? Some expats choose to ignore the request - but this high-risk approach is likely to quickly bring about a negative outcome. Your bank might simply close your account, or even freeze your funds. Alternatively, your details may be forwarded to the IRS anyways and you may end up with a big red flag by your name. “If you are not presently compliant with US tax laws, the time for hiding is over," Zemelman says. "Your goal should now be to make the appropriate IRS voluntary disclosure to come clean and resolve your undisclosed foreign accounts." For expats who are not yet compliant with US tax filings, including submitted FBARs (Foreign Bank Account Report) and tax returns, Taxes for Expats recommends three steps. "Respond to the bank immediately and tell them you are in the process of filing," advises Zemelman. "Ask to set up a timeline or get an extension." Next, contact a professional US expat tax preparation company such as Taxes for Expats. "If you were not working against the clock you could try to do it all on your own - but it's not something we'd advise if the bank is already on your case," Zemelman remarks. Finally, make sure to take advantage of the Streamlined Filing Procedure, which can help you become fully compliant without the risk of penalties. The procedure requires completing three years of tax returns and six years of FBAR, and will put you in the clear once and for all. Think your bank won’t know you’re American? You’re probably wrong, Zemelman warns. Foreign banks have a list of various criteria to examine when determining if clients have a significant connection to the US. Every account is evaluated individually. “Your birthplace is shown on your passport - even if it’s not a US one. Likewise, a client may have transferred funds to the US or may have an American address,” Zemelman says. If banks fail to comply and report your information to the US, they get slapped with heavy fines - so instead they opt to play nice with Uncle Sam. “If you are an American with an overseas bank account, it is likely that your bank has already asked or is going to ask about your US compliance status,” Zemelman says. She advises US citizens outside the US to plan for this - as foreign banks have essentially become enforcement agents of the IRS. So what do you do when the bank in your country of residence starts sniffing around and asks about your US tax compliance status? It doesn’t have to be a nightmare, Zemelman says – if you handle it right. “Don’t wait for the enforcement division to find you,” Zemelman concludes. “Come forward and fix your US tax situation first.”
Post Comment Private Reply Ignore Thread
Top • Page Up • Full Thread • Page Down • Bottom/Latest
#1. To: X-15 (#0)
Or, alternatively, renounce your US citizenship, which expats are doing in increasing numbers because of said law, because some foreign banks would rather refuse service to US citizens rather than deal with Uncle Sam's extraordinary burdens, even if US citizens want to comply.
I wish that I could renounce in place.
“The most dangerous man to any government is the man who is able to think things out... without regard to the prevailing superstitions and taboos. Almost inevitably he comes to the conclusion that the government he lives under is dishonest, insane, intolerable.” ~ H. L. Mencken
Zemelman -- isn't that an Italian name?
Ha! My first guess was Dutch-Neopolitan with a cousin from Wales. https://www.facebook.com/taxesforexpats “If you are not presently compliant with US tax laws, the time for hiding is over," Zemelman says. "Your goal should now be to make the appropriate IRS voluntary disclosure to come clean and resolve your undisclosed foreign accounts."
#2. To: Pinguinite (#1)
#3. To: X-15 (#0)
#4. To: NeoconsNailed (#3)
-Alex Kurtagic
#5. To: X-15 (#0)
gee wonder what kind of name is "Zemelman"? Zemelman warns.
"Even to the death fight for truth, and the LORD your God will battle for you". Sirach 4:28
#6. To: Artisan (#5)
I'm sitting here wondering. Whatever kind it is, it usually pops up where somebody's putting some big horrible whammy on us!
#7. To: All (#6)
(The hypocrisy compounded....... NN) http://www.internationalman.com/articles/rothschild-usa-is-the-new-switzerland Rothschild: USA is the New Switzerland At one time, tax havens took great pride in calling themselves just that, since low- tax jurisdictions provide people with freedom from oppressive taxation. But, in recent decades, the Organisation for Economic Co-operation and Development (OECD, based in France but largely funded and controlled by the U.S.) has been on a rampage to crush tax havens. The attacks have been regular and forceful, and although tax havens still exist around the world, every one of them has caved to a greater or lesser degree to ever more stringent OECD “international practices.” Presently, all tax havens live in fear of the OECD and its powerful enforcer, the U.S. No measure has been more devastating to freedom from taxation than the U.S. Foreign Account Tax Compliance Act (FATCA). The secret of its success is that the U.S. fines banking institutions for not following the arbitrary FATCA guidelines. How can one country fine a bank in another country if that bank is following the laws of the country in which it’s located? Well, failure to pay the fine may result in the U.S. cutting the bank out of international transfers in the dollar system, which would collapse the bank. Essentially, this is a “shakedown” operation, purported to focus on tax evasion but, in fact, focused primarily on demanding protection money from international banks. (According to Bloomberg Business, more than eighty Swiss banks have been subject to a total of roughly five billion dollars in penalties and fines imposed by the U.S.) Not surprisingly, the OECD has spent decades castigating the very existence of tax havens, declaring them to exist solely for the purposes of money laundering, terrorism funding, tax evasion, and even “international prostitution” (no kidding). In spite of the OECD’s condemnation of tax havens, the U.S. has, in recent years, created tax havens in several states and is being dubbed “the new Switzerland.” Of particular interest here is that the U.S. itself has not signed on to the OECD’s “international standards.” The U.S. is, therefore, imposing more stringent restrictions on others than it is willing to comply with itself. (Had Attila the Hun gotten into banking, this is the approach he might have used.) Recently, the U.S. has lifted the veil on their ambitions by announcing further, more dramatic inroads into becoming a tax haven. Andrew Penney, a managing director of Rothschild & Co. in San Francisco, announced that the world’s wealthy can avoid paying tax by moving their wealth to the U.S. As the U.S. banks will not be subject to the draconian limitations that the U.S./OECD have forced on the world’s other tax havens, the U.S. will (presumably) take over the tax haven business. In one fell swoop, the sanctimonious position taken by the U.S., portraying tax avoidance as unpatriotic and even criminal, has been turned on its head. Rothschild, a dominant banking name worldwide, since the eighteenth century has a company in Reno, Nevada, just down the road from casinos such as Harrah’s and Eldorado, placing their new tax haven where “high rollers” might be found. Mister Penney has described the U.S. as “effectively, the biggest tax haven in the world,” although Rothschild & Co. have cautioned him not to publicise this view. Now, it’s important in assessing this development not to point any undeserved criticism at the U.S. They should not be criticised because: They offer client privacy. They offer freedom from U.S. taxation for non-U.S. citizens. They offer a haven for those who are subjected to excessive taxation elsewhere. These are laudable practices. However, criticism may justifiably be made because the U.S. has spent decades vilifying these very practices, as practiced by other tax havens. Further, the U.S. has then done all it could to destroy those freedoms in the existing tax havens, even to the point of endangering the economies of those countries, then hypocritically offering the very same opportunities itself. So… will the U.S. be “the new Switzerland” it’s claiming to be? I think not. First, Americans cannot make use of the haven. That will mean that the U.S. government will be providing tax advantages to non-U.S. nationals that it does not provide to its own citizens. (The Isle of Jersey has a similar tax structure, which has allowed the OECD to come down heavily on them, crippling Jersey’s economy.) In addition, this fact will not sit well with Americans, who will resent foreigners being more greatly advantaged in America than Americans themselves. The great majority of Americans have declared in polls that they already distrust their own politicians across the board. “Tax discrimination” will most certainly aggravate that existing resentment. Second, the OECD have been fairly successful in their campaign to remove privacy from tax havens, through the characterisation of tax havens as centres for money laundering, terrorism funding, and tax evasion. For the U.S.-led OECD to accept the U.S. adopting the very same business practices that are the model for tax havens, the OECD loses its one effective weapon – the concept of tax avoidance as shameful. More and more, the existing legitimate tax havens of the world have been bristling at the ever-increasing “international standards” demanded by the OECD. Many have outright refused to adopt standards that have not been adopted by OECD member countries. With the Americans jumping into the tax haven pool at the deep end, the tax havens of the world are likely to refuse to honour existing agreements, let alone take on more stringent trumped-up standards. Third, with the U.S. going full blown into the tax haven business, it can be expected that they’ll welcome clients from France, Germany, the UK, etc. – countries whose wealthier citizens are the primary clients of existing tax havens. In doing so, the U.S.’s allies in the OECD will cry foul. It’s likely that they’d create their own tax havens in order to compete. This would mean that Germans would be making deposits in the U.S. whilst Americans would be making deposits in Germany. (The U.S. would end up as the greater loser, and the once-allied countries would be like a group of cats fighting over the same bone.).......... 
#8. To: All (#7) (Edited)
Preparing to work this story up at patriotcannon.blogspot.com, I'm thrown backwards again by its hateful tone and thrust. This isn't journalism, its a rabbinical "RESISTANCE IS FUTILE" sermon against people retaining any hope of financial privacy. Oh, how altruistically they coach you on throwing away what shreds of it you may retain! The article is anonymous -- appropriately enough since it's so despicable. Up top the page merely clues us that the site has editions for 8 European countries, but at the very bottom it's divulged that the thing's BASED IN SWEDEN, the latest world center of Kafkaesque Orwellianism. Do you suppose it's simply a USG front? --------------------------------------------------------- All that hath breath
Top • Page Up • Full Thread • Page Down • Bottom/Latest