Bailey McCann, Opalesque New York:
The US Treasury and IRS have issued their final rules and guidance on the Foreign Account Tax Compliance Act (FATCA). Alternative investment firms and their lawyers have been eagerly awaiting the finalization of the law which has seen some delays. The proposed regulations make additions and clarifications to previously issued FATCA regulations and provide guidance to coordinate FATCA rules with preexisting due diligence, reporting, and withholding requirements under other provisions of the Internal Revenue Code.
A critical part of FATCA requires all of the other countries in the world to make agreements with the IRS as it concerns tax reporting for US persons or US firms abroad. The United States has signed agreements with 22 countries, and many more have either reached agreements in substance that are awaiting signature, or are well along in the process. Having this number of countries on board is notable as the law has faced steep resistance from both foreign governments and foreign banks citing extraterritorial overreach.
The new list of guidance contains over 50 specific items based on feedback received during the recent public comment period. Sources affiliated with Treasury and the IRS say they feel like this package marks the final big push for implementation. Much of the new guidance clears up discrepancies in the law as written on areas like required documentation and withholding requirements.
The release of this......................
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