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Posted By: Marty NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 05/18/13 11:53 AM

SAYS US EMBASSY OFFICIAL

Joseph Boski, Political and Economic Section Chief at the U.S. Embassy in Belmopan, Belize, told Amandala today that the Foreign Account Tax Compliance Act (FATCA), which will see its full implementation in 2014, was put into place to ensure better tax compliance.

"The principle is pretty clear," said Boski. "The FATCA law addresses tax compliance."

The FATCA applies also to Belizeans with dual US nationality, as well as "green card" holders and US nationals living in Belize or any person in those categories who have financial interest in Belize, including offshore bank accounts.

Boski said the FATCA is "very ambitious" and he hopes it will be very effective, as well.

He notes that anyone who is paying US taxes or should be paying those taxes and who has financial assets overseas should double-check whether they need to report financial assets overseas. This, he said, especially applies to US citizens or financial institutions overseas doing business with US citizens located either overseas or in the US.

The US Embassy officer said that if there is an American with assets in Belize who is liable to pay taxes but is not, and the financial institutions, such as banks, are aware, then they are asked to assist the United States Internal Revenue Service (IRS) in identifying this tax evasion.

Non-compliance could result in a 30% withholding tax being levied on the person of interest.

Boski said he hopes the FATCA would serve as a model for all countries seeking tax compliance from citizens living overseas or who have assets overseas.

"I think you know, in order to get it to work, private banks have to actively engage with the process," said Boski.

He said that some of the provisions of FATCA are already in effect, and the IRS has agreements already with some countries and banking institutions.

A Belize banker has told us that they would be signing up with the IRS online portal when it opens up on July 15. (See story, "Belize Banks brace for implementation of far-reaching US tax law", appearing on page 2 of the Wednesday, May 15, 2013 edition of Amandala.)

Boski shares the following links for those who want further information:

http://www.irs.gov/Businesses/Corporations/Foreign-Account-Tax-Compliance-Act-(FATCA)

http://www.treasury.gov/press-center/press-releases/Pages/tg1759.aspx

http://travel.state.gov/travel/living/living_1234.html

Amandala

Posted By: Marty Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 05/23/13 05:52 PM
FACTA and You - Know the Facts:

Next year 2014, Washington will enact the most ambitious tax-recovery plan in history, the Foreign Account Tax Compliance Act. Under FATCA, foreign financial firms will have to proactively identify every American (Belizean American) account holder with assets of more than $50,000 and report details about their financial activity or face a significant penalty.

The move is very unpopular among foreign banks, governments and Americans living abroad, but the more complex rules could actually mean more business for offshore centers. By the time FACTA is in full force, in 2017, truly wealthy individuals and corporations will almost certainly have used their resources to find more intricate loopholes.

Good read.

Click //Ambergriscaye.com/art2/FactsAboutFACTA2013b.pdf for pdf from Corozal Daily
Posted By: elbert Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 05/23/13 06:23 PM
Does it seem quiet in here ?? Hello, Hello... No one commented on this when you posted it last week either :-)
I'm not sure there is a $50,000 threshold and this applies to every US cit, no matter what they have in the bank
I am curious if US citizens need to report assets such as real estate holdings, etc.... ? over $50,000 value

No, not real property.......yet.
Normally foreign real estate does not have to be reported. HOWEVER, if you hold the real estate through a foreign corporation, partnership or other foreign entity, depending on its value you may have to report it. For example, if you are a stockholder in a Belize corporation that has real estate among its assets, you may have to report it on IRS Form 8938. (Source: IRS)
Posted By: Marty Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 06/22/13 11:10 AM

FATCA, Do We Have To?

Unless you're a banker, you probably don't know what the term FATCA means - but the United States Foreign Account Tax Compliance Act has far reaching implications for Banking in Belize and all over the world. It's an instrument designed by the United States Internal Revenue Service to crack down on tax cheats; mainly US citizens and permanent residents who bank their money in other countries - and in so doing, evade US taxes. Now, the IRS wants overseas banks to sign in time for implementation on December 31, 2013. That includes Belizean banks which had a special meeting with the Prime Minister yesterday to discuss the far reaching implications of FATCA. The banks are being forced to sign possibly as early as August - but there are many issues to iron out first. And we say "forced" because if the local banks don't sign, they lose their correspondent banking relationship with US banks, in which case, they'd basically have to close down.

But it's what you might call a "ticklish" issue because the banks will have to report to the IRS all US citizens or green card holders with over fifty thousand dollars in Belizean Banks. And there are heavy penalties against the banks and the individuals for non-reporting.

And, it's not only in Belize - it's all over the Caribbean. Our colleague at CEEN News in Jamaica Kalilah Enriquez recently attended a Diaspora conference where the issue was front and center. She explains the broad strokes and the finer details of FATCA:�

We reached the Prime Minister who said the government's position is still evolving as there is quote, "a significant shortage of information." He says that after careful study, Government will offer its formal position as to the best way to proceed.

We spoke to one local banker who told us there are significant practical issues that arise - because the banks don't know which of their depositors hold a US Passport or Green card. We'll keep following the story�.

Channel 7

Posted By: Marty Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 06/22/13 11:36 AM

MORE TAX INFO EXCHANGE AGREEMENTS IN THE WORKS: UKRAINE, ITALY, CANADA, INDIA, US

Belize bankers meet with GOB to discuss new US requirement for bank disclosures

News coming out of the Ukraine today indicates that that country's Cabinet has approved the draft of a Tax Information Exchange Agreement (TIEA) with Belize.

The Director-General of Belize's International Financial Services Commission (IFSC) told Amandala that to date, Belize has in place 16 such agreements with other countries, the most recent one having been signed with Poland on May 16, 2013. He confirmed that Belize today received notification from Ukraine that they are ready to sign the new TIEA with that country.

Since 2009, Belize has signed TIEAs with Australia, United Kingdom, Belgium, Netherlands, Sweden, Finland, Greenland, Norway, Iceland, Denmark, Faroes, Portugal, France, Ireland, and Mexico.

The draft TIEAs with Italy and India, said Ghandi, are awaiting signature. Belize has sent a draft TIEA agreement to the United States government; however, talks on that proposal are still pending.

Belize also plans to sign TIEA's with Canada and Georgia, another country near the Ukraine, shortly.

Ghandi said that the Organisation for Economic Co-operation and Development (OECD), an organization of 34 states, including the US, Canada, Mexico, and the UK, is asking all countries to sign these agreements for exchange of information and transparency.

Ghandi confirmed that such agreements include provisions under which governments undertake to share banking information and information on the owners of companies, their agents, as well as their nominal owners and authorized delegates.

The OECD believes their nationals hide their wealth in small countries. Once the TIEA is signed, Government issues a statutory instrument, which is laid before Parliament for acceptance.

Information disclosed under TIEAs could include details of banking transactions, and since the agreements are sanctioned by Parliament, banks can't be sued for breach of confidentiality.

However, Ghandi explained that the agreements have little relevance for Belize, since Belize's tax laws are territorial, and the Government of Belize only taxes within its jurisdiction.

Meanwhile, Ministry of Finance officials met today with representatives of the banking sector to discuss the United States' new tax law - the Foreign Account Tax Compliance Act (FATCA), which calls on foreign banks doing business with persons of interest to the US, who should be paying taxes to the US Internal Revenue Service (IRS), to register with the IRS.

Full implementation is to take effect in 2014; however, Belizean bankers are calling on the Government of Belize to look into an alternative procedure whereby banks would not directly sign agreements with the IRS, but whereby they could provide the requested information under an intergovernmental agreement.

We understand that the local banks are concerned about the sovereignty and confidentiality issues, since the FATCA is a US law.

However, the US has indicated that non-compliant banks could face sanctions, including the withholding of assets overseas in the US - a matter which is of major concern to banks which rely on foreign banks in the US with whom they have correspondent banking relations, for international exchange of funds.

Amandala

I've heard it said that money goes where it is welcome.

If the US would make money welcome instead of holding it hostage maybe all this stuff would not be necessary.
Maybe we should be investing in coffee cans and mattresses....
http://www.irs.gov/Businesses/TypesofForeignAssetsandWhetherTheyareReportableonForm-8938

This link will tell you exactly what is reportable and what is exempt.

Cayo Accounting Services
Isn't this virtually everything?
Seems like if it's foreign they want to know about it, if it's domestic they already do?
Financial (deposit and custodial) accounts held at foreign financial institutions


Yes

Financial account held at a foreign branch of a U.S. financial institution


No
This new law, is in fact, an old law. US Citizens have always had to claim worldwide income. Facta is more of a way for the US to actually make sure they are getting the taxes on the worldwide income. Don't worry about it unless you have more than $50000 in the bank or in stocks etc. If you have been claiming your worldwide income, then no need to worry at all. The banks are the ones with the real issue, unless of course you are hiding your assets.
If you've seen the new ad campaign all over the US news, BuyBelize.com, one of the things they advertise is banking friendly, tax haven Belize.
I'm assuming they are referring to offshore accounts, which up to now have been ostensibly off limits to prying eyes.
Personally I don't believe for a minute that the US Gov. doesn't already have access to anything they want to know.
For at least 8 years now, whenever I do a transfer into one of these accounts, it goes through a US bank.
Personally I have nothing to hide, but offshore accounts were kinda "invented" for people that do.
After looking at BuyBelize website they are referring to buying a home in Belize. This is not subject to US taxes yet. And I do mean yet. It will happen eventually. The US is implementing ways to make sure their laws are followed, which is why FACTA is more of a problem for banks than for the average person.
Posted By: ragman Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 06/25/13 05:21 AM
I believe that any profit from selling a home that a US Citizen owns outside the USA are and have been subject to any taxes that would be due under the same circumstances in the USA. These are the only taxes involved in a real estate transactions on the Federal level as far as I know.

Wire transfers to Belize go through a bank in Miami and most homes would be paid for this way so they already have some records on these types of transactions. It is difficult to get away from the IRS. You have to work at it a little. When you sell usually the funds are wired into the USA, more records.

Personally by my way of thinking it is not worth the effort when you consider the risk.
Originally Posted by cayobook
This new law, is in fact, an old law. US Citizens have always had to claim worldwide income. Facta is more of a way for the US to actually make sure they are getting the taxes on the worldwide income. Don't worry about it unless you have more than $50000 in the bank or in stocks etc. If you have been claiming your worldwide income, then no need to worry at all. The banks are the ones with the real issue, unless of course you are hiding your assets.


Wrong information. If you have 10K or more US dollar equivalent in a foreign bank account, you must file a IRS tax form declaring that.
Again, the information on the website from the US government is $50000. This is for FATCA.

Under FATCA, certain U.S. taxpayers holding financial assets outside the United States must report those assets to the IRS, generally using Form 8938, Statement of Specified Foreign Financial Assets. The Form 8938 must be attached to the taxpayer's annual tax return.
Uncertain whether you have to file? Generally, aggregate value of these assets must exceed $50,000, but in some cases, the threshold may be higher.


Posted By: ragman Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 06/25/13 01:13 PM
Warren you are correct of course for bank accounts. A lot of accountants in the USA (Maybe I should say CPA's) file the necessary paperwork (no extension allowed) the minute they find that you have a foreign bank account, without concern for amount. I'm not sure the reasoning behind that (maybe to run up fees?) but that has been my experience with two different CPA's. Because of this I no longer worry about keeping it below $10k. At any rate if it keeps me out of the IRS's bulls eye I'm happy. An audit could cost me much more in time and money even if I believe everything is correct.

The truth is that the tax laws in the USA are just too complex and you can get tripped up real easy unknowingly. The fact that the normal person just can not file his own taxes in most cases. When I read over mine I get a headache and there is almost no way to follow it completely. I have to hope that the information I supply was all entered correctly by both myself and my CPA. This could all be done on a postcard in a sensible system. Without anything too unusual 45 pages for Federal and 20 some for the State, give me a break.
I see the terms "accounts" and "assets" used. Do all assets have to be reported or just money in bank accounts. For example am I supposed to be reporting the value of my condo also?
Posted By: ragman Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 06/25/13 01:56 PM
No, I don't believe so.

I amend that to state that if it is used for investment (rental) purposes then income would have to be reported by law. I'll be interested in what others have to say. This only has to do with what Banks have to report.
http://www.irs.gov/Businesses/Small...reign-Bank-and-Financial-Accounts-(FBAR)

This is the IRS info on reporting foreign bank accounts for individuals. Some here are confusing FACTA with FBAR.

To comply as a US citizen, if you have a foreign bank account over 10K, you must report.

This should help also.

http://taxes.about.com/ gi/o.htm?zi...rison-of-Form-8938-and-FBAR-Requirements
Exactly Bywarren..
The information I put on here is not incorrect as you state. I will try to explain this is in its simplest terms.
FBAR
Q. Who must file an FBAR?
A. Any United States person who has a financial interest in or signature authority or other authority over any financial account in a foreign country, if the aggregate value of these accounts exceeds $10,000 at any time during the calendar year. See also Notice 2010-23.

If you have 10000 file...

FATCA...is a law put in by the US to try to get a handle on foreign income that they believe they are entitled to the tax. They have now put the responsibility on the banks of all countries to tell them what you have. If the banks dont comply, they will no longer do business with those banks. This is why Belize has to comply and China doesnt. FATCA is truly after the people who have alot of money and are trying to hide it..not the average person.

I am not trying to argue with you, but telling people if they do not have more than 50K in a foreign bank then not to worry, is bad advice from what little I know. Of course anyone who relies on tax advice on a message board probably needs advice from someone who knows more than me.
Bywarren ..not arguing...unfortunately chat typing does not get the point across how it was intended. I tell them based on FATCA if they have less than 50000..dont worry...
FATCA add a t at the end..was set up so the govt could have control of other countries banks. Period. The bank complies or its screwed, if it is in a country as small as Belize who relies on
US funds or its funding.

The original post was regarding FATCA.
Unfortunately the US Treasury in an attempt to somehow control both the flow of money and the evasion of taxes has implemented many draconian regulations. These regulations obviously only hurt the honest people that get caught because the thieves are smarter than the bureaucrats. I have had to close at least six bank accounts outside the US (including two in Belize) because of the hassles of reporting to the Treasury and the IRS virtually everything that requires. I note that the only thing to come out of the recent G8 meeting (other than Putin embarrassing Obama) was to try and figure out more ways to make smaller countries help the big high tax countries collect their blood money. This is eventually going to lead to armed revolt. The politicians running governments in the West are hooked on tax revenues to use to buy votes and there is only one way off their addiction - 'Cold Turkey'. It can't happen soon enough for me.
Posted By: ragman Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 06/27/13 03:18 PM
Capt. Very good way to put it and right on. I see this at local and state levels also. There are thousands of people out there trying to figure how to get more money from anyone who has it, to feed the BEAST. This can not go on much longer, I say. But you know what, there are more and more people with a vested interest in making this continue.
I worked one year for the US Gov, Defense Logistics Agency, quit in disgust.
There were 5,000 paper-pushers in this office, at any given time 3,000 were asleep at their desks.
No lie, literally out like a light.
Once you get 1 year in you cannot be terminated.
The first thing you do is get an assistant, and then they get an assistant, etc., etc.
Rule number 1 is spend every dime so you can ask for more the next year and expand the budget.
It grows like a cancer, and is historically always terminal.
Our government is entering the same phase as one sipping the last bit from a milkshake thru a straw. I hate that sound!
Right on capt, champion, artisan and ragman..nicely said.
Posted By: Marty Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 06/28/13 10:42 AM

Belize PM 'very happy' over tax decision

The world's so-called tax havens have come under increasing scrutiny from politicians in recent weeks.

At last week's G8 meeting in Northern Ireland, political leaders hailed an agreement to stop companies hiding their profits in shadowy offshore centres.

One of these is Belize, which has already agreed to share tax information with international authorities.

Its Prime Minister, Dean Barrow, told the Today programme: "We are very happy that there are things happening that will allow all of us to weed out the bad guys, those that might be trying to take advantage of our jurisdictions.

"We are confident that we will be able to maintain this sector of our economy."

BBC (with audio)

Wonder where he parks his money?
smile
I wish George Carlin were with us to do a commentary on FBAR and FATCA ..... he'd make the Capt. sound tame.


I wish the government would make an easier tax law. Tax it all, depending on amounts, here's what you pay. Problem solved.
Posted By: Marty Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 08/09/13 02:32 PM
BELIZE BANKERS & GOB DISCUSS FACTA

In June 2013 Belize bankers met with GOB to discuss new US requirement for bank disclosures under USA's Foreign Account Tax Compliance Act.

News coming out of the Ukraine already indicates that, that country's Cabinet has approved the draft of a Tax Information Exchange Agreement (TIEA) with Belize.

The Director-General of Belize's International Financial Services Commission (IFSC) GIAN C. GANDHI has told Belize media that to date, Belize has in place 16 such agreements with other countries, the most recent one having been signed with Poland on May 16, 2013. He confirmed that Belize has received notification from Ukraine that they are ready to sign the new TIEA with that country.

Since 2009, Belize has signed TIEAs with Australia, United Kingdom, Belgium, Netherlands, Sweden, Finland, Greenland, Norway, Iceland, Denmark, Faroes, Portugal, France, Ireland, and Mexico.

The draft TIEAs with Italy and India, said Ghandi, are awaiting signature. Belize has sent a draft TIEA agreement to the United States government; however, talks on that proposal are still pending to date.

Belize also plans to sign TIEA's with Canada and Georgia, another country near the Ukraine, shortly.

Ghandi said that the Organisation for Economic Co-operation and Development (OECD), an organization of 34 states, including the US, Canada, Mexico, and the UK, is asking all countries to sign these agreements for exchange of information and transparency.

Ghandi confirmed that such agreements include provisions under which governments undertake to share banking information and information on the owners of companies, their agents, as well as their nominal owners and authorized delegates.

The OECD believes their nationals hide their wealth in small countries. Once the TIEA is signed, Government issues a statutory instrument, which is laid before Parliament for acceptance.

Information disclosed under TIEAs could include details of banking transactions, and since the agreements are sanctioned by Parliament, banks can't be sued for breach of confidentiality.

However, Ghandi explained that the agreements have little relevance for Belize, since Belize's tax laws are territorial, and the Government of Belize only taxes within its jurisdiction.

Meanwhile, Ministry of Finance officials have met with representatives of the banking sector to discuss the United States' new tax law - the Foreign Account Tax Compliance Act (FATCA), which calls on foreign banks doing business with persons of interest to the USA, who should be paying taxes to the US Internal Revenue Service (IRS), to register with the IRS.

Full implementation is to take effect in 2014; however, Belizean bankers are calling on the Government of Belize to look into an alternative procedure whereby banks would not directly sign agreements with the IRS, but whereby they could provide the requested information under an intergovernmental agreement (IGA).

We understand that the local banks are concerned about the sovereignty and confidentiality issues, since the FATCA is a USA law.

However, the USA has indicated that non-compliant banks could face sanctions, including the withholding of assets overseas in the USA - a matter which is of major concern to banks which rely on foreign banks in the US with whom they have correspondent banking relations, for international exchange of funds.

Editor's Note: Compliance to the USA request will lend the burden of administration expenses ultimately on the Belizeans as we understand that the local banks and government will not be compensated to hire extra personnel to administrate and oversee compliance on behalf of the USA/IRS.

Courtesy: Corozal Daily (�Sometimes)
Posted By: ragman Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 08/10/13 12:48 AM
More on FATCA from Business Week

Quote
Americans Giving Up Passports Jump Sixfold as Tougher Rules Loom

By Dylan Griffiths on August 09, 2013

http://www.businessweek.com/news/20...ports-jump-sixfold-as-tougher-rules-loom

Americans renouncing U.S. citizenship surged sixfold in the second quarter from a year earlier as the government prepares to introduce tougher asset-disclosure rules.

Expatriates giving up their nationality at U.S. embassies climbed to 1,131 in the three months through June from 189 in the year-earlier period, according to Federal Register figures published today. That brought the first-half total to 1,810 compared with 235 for the whole of 2008.

The U.S., the only nation in the Organization for Economic Cooperation and Development that taxes citizens wherever they reside, is searching for tax cheats in offshore centers, including Switzerland, as the government tries to curb the budget deficit. Shunned by Swiss and German banks and facing tougher asset-disclosure rules under the Foreign Account Tax Compliance Act, more of the estimated 6 million Americans living overseas are weighing the cost of holding a U.S. passport.

"With the looming deadline for Fatca, more and more U.S. citizens are becoming aware that they have U.S. tax reporting obligations," said Matthew Ledvina, a U.S. tax lawyer at Anaford AG in Zurich. "Once aware, they decide to renounce their U.S. citizenship."

Fatca requires foreign financial institutions to report to the Internal Revenue Service information about financial accounts held by U.S. taxpayers, or held by foreign entities in which U.S. taxpayers hold a substantial ownership interest. It was estimated to generate $8.7 billion over 10 years, according to the congressional Joint Committee on Taxation.

Delaying Implementation

The 2010 Fatca law requires banks to withhold 30 percent from "certain U.S.-connected payments" to some accounts of American clients who don't disclose enough information to the IRS. While banks can sign agreements to report to the IRS individually, many are precluded from doing so by privacy laws in their jurisdictions.

The Treasury Department last month announced that the IRS will delay the start of Fatca by six months until July 1, 2014, to give foreign banks time to comply with the law. The extension of the act follows a previous one-year delay announced in 2011.

Financial institutions including Canada's Toronto-Dominion Bank (TD) and Allianz SE of Germany have expressed concerns that Fatca is too complex.

The latest delay comes after the Swiss government agreed in February to simplifications that will help the country's banks implement Fatca.

Penalty Threat

"The United States wishes to ensure that all income earned worldwide by U.S. taxpayers on accounts held abroad can be taxed by the United States," the Swiss government said on April 10.

Since 2011, Americans, who disclose their non-U.S. bank accounts to the IRS, must file the more expansive 8938 form that asks for all foreign financial assets, including insurance contracts, loans and shareholdings in non-U.S. companies.

Failure to file the 8938 form can result in a fine of as much as $50,000. Clients can also be penalized half the amount in an undeclared foreign bank account under the Banks Secrecy Act of 1970.

The implementation of Fatca from July next year comes after UBS, Switzerland's largest bank, paid a $780 million penalty in 2009 and handed over data on about 4,700 accounts to settle a tax-evasion dispute with the U.S. Whistle-blower Bradley Birkenfeld was sentenced to 40 months in a U.S. prison in 2009 after informing the government and Senate about his American clients at the Geneva branch of Zurich-based UBS AG. (UBSN)

Compliance Costs

The additional compliance costs for companies to ensure that Americans they hire are filing the correct U.S. tax returns and asset-declaration forms are at least $5,000 per person, said Ledvina.

For individuals, the costs are also rising. Getting a mortgage or acquiring life insurance is becoming almost impossible for American citizens living overseas, Ledvina said.

"With increased U.S. tax reporting, U.S. accounting costs alone are around $2,000 per year for a U.S. citizen residing abroad," the tax lawyer said. "Adding factors, such as difficulty in finding a bank to accept a U.S. citizen as a client, it is difficult to justify keeping the U.S. citizenship for those who reside permanently abroad."

My bank here in Belize has mailed me disclosure forms to sign. I have not signed them. I hope more countries stand up to this !

I think the politicians who live in the US and received services from them and hide their money off-shore are disclosed. Leave those of us who do not received any services or representation alone.
Posted By: ragman Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 08/10/13 01:20 PM
Harriette you and I may find ourselves without a bank account because of the cost and hassle of complying with this law. The law as I understand it doesn't apply to people with modest sized accounts, yet, but there will be accounting required to prove this. Maybe not right away but in the future when the banks in Belize and else where get sick of these type of regulations that they really have no choice but enforce.

Because of trade from the US which is vital to Belize and the US dollar which is the trading medium the government here will sadly have no choice as the monster back home tries to feed it's insatiable appetite for money.
we've always complied with FBAR, but haven't and probably won't have enough money in our Belize bank accounts to have to worry about FACTA.
Posted By: ragman Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 08/17/13 04:26 PM
Originally Posted by catdance62
we've always complied with FBAR, but haven't and probably won't have enough money in our Belize bank accounts to have to worry about FACTA.


Cat, I do not think I explained my point correctly, allow another attempt to show why this may very well affect you.

Like you I've always reported to the IRS as required. I supply this info to my CPA. He unknown to me always reports to the IRS even though my account has been purposely kept just under the reporting requirements. He is the pro so I questioned but will go along with his thoughts.

The banks also have to monitor accounts of American accounts to make sure they do not meet the reporting requirements. They also have to report on those that do. You can expect the dollar level which requires reporting to decrease over the years. This is an expense and hassle to the banks that have few American accounts in the whole country and does put them at risk. The USA has proposed serious penalties to these banks if there reporting is found incorrect. I have to assume that they will have to submit to audits and investigations when a case is brought to USA's attention.

The banks that are forced to deal with the USA may throw up their hands and say no more USA citizens may have an account or maybe only those over a certain large amount that makes it worthwhile. Maybe they will eventually drop all accounts. Another matter which is being pushed by the progressives in the USA is to tax wealth. This requirement will require even more reporting and I'm sure will include real estate and their transactions.

This is a hassle all over the world. Google Americans who are denouncing their citizenship to escape taxes and reporting and you will see that the numbers are relatively small but increasing dramatically. The USA is one of the only countries in the world that taxes American income no matter what country it was earned in. This includes any money made on a real estate transaction. For the first time in my memory there is serious talk of exit taxes, even on smaller amounts for people who are leaving the USA. I thought it was only the repressive communist countries that trapped their citizens inside their borders but��..I may have to rethink that position.

The monster of big government in the USA must be fed and is constantly looking for the food which keeps it going. (money) It is a nightmare.
well, I guess we will just have to ride it out to see what happens.....Don't know what else to do! And I don't want to renounce citizenship.
Posted By: ragman Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 08/18/13 02:43 PM
Originally Posted by catdance62
well, I guess we will just have to ride it out to see what happens.....Don't know what else to do! And I don't want to renounce citizenship.


Yes, I agree with every word. Time will tell.
Posted By: Marty Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 10/08/13 11:11 AM

FATCA seminar hears of stiff penalties

The U.S. Internal Revenue Service has at least seven ways to catch those trying to avoid its Foreign Accounts Tax Compliance Act, and a Department of Justice database on 33,000 taxpayers to help.

Local officials estimate that as many as 6,000 people in Cayman - more than 10 percent of the population - will have obligations under FATCA, whether paying taxes, filing forms, reporting on bank accounts or just seeking legal advice.

"FATCA is coming. The U.S. has delayed implementation by six months, but it's coming," said George Town representative Roy McTaggart.

Opening Friday's half-day FATCA seminar in a packed ballroom at the Westin, Mr. McTaggart said the Cayman Islands government hoped to offer "a kind of road map, giving you the best resources available," helping U.S.-affiliated people navigate the complexities of the law, intended to collect arrears from delinquent taxpayers.

Many may be caught unaware

A host of those liable to the IRS may not even know it. The IRS net is designed to catch Green Card holders; property owners; anyone with a U.S. bank account or signing rights; anyone with shares in a U.S. company, a trust or pension plan; anyone with a U.S. passport, whether they use it or not; even anyone born in the U.S. whether or not they have a U.S. passport; or even using a U.S. mailing address.

"These are enhanced reporting requirements to help the U.S. government ferret out those who have not been paying their taxes," said keynote speaker Steven Cantor, managing partner at Miami's Cantor and Webb law firm.

"The U.S. is against taxpayers collecting foreign income outside of tax," he said, explaining that even the American spouse of a non-American is liable for half the income earned in the joint household.

Acknowledging the welter of detail and difficulties in the law, part of 2010's Hiring Incentives to Restore Employment Act, Mr. Cantor said the only people that like FATCA are lawyers and accountants.

"From the perspective of a U.S. international tax attorney, we love FATCA for four reasons: complexity; uncertainty, with all the changes since 2010; change, with all the amendments and reforms to the law; and fear-mongering," Mr. Cantor said.

"One man told me it was the end of Western civilization as we know it," Mr. Cantor said, explaining that "No, FATCA is aimed at foreign financial institutions and other financial intermediaries to prevent tax evasion by U.S. citizens and residents through use of offshore accounts."

Those "foreign financial institutions" and intermediaries include any business that accepts deposits in the ordinary course of its affairs. The definition includes banks and financial services firms, and any entity, including insurance companies, that invests, trades in securities or commodities, partnership interests or annuity contracts.

Penalties

Any foreign financial institution failing to identify its U.S.-owned accounts faces a 30 percent withholding tax on all U.S.-based income and assets.

On Aug. 19, the IRS opened an online "portal" by which FFIs register with the agency, providing information on operations related to U.S. account holders.

They must finalize that information by January 2014, receiving a "global intermediary identification number," followed by the June IRS publication of the FFI list.

Mr. Cantor described the seven ways the IRS could identify someone trying to avoid FATCA compliance, starting with IRS litigation.

"There also could be changes in the law. There might be a whistleblower. If you go to renew your U.S. passport, you may be asked if you have paid your taxes. There is what we call 'audit by infection,' when your name may come up during the course of someone else's audit.

"When you enter into the U.S., you may be asked, and your Green Card taken. The officer will tell you where you can pick it up as long as you bring your tax returns proving you have paid."

Finally, Mr. Cantor said, the agency will learn about ownership of U.S. assets at the time of your death.

Audible despair gripped the hundreds of audience members when Mr. Cantor described eight IRS and Treasury Department forms required by the agency, followed by another five that might be needed.

Penalties are stiff for not filing, he said. For example, falsifying or failing to submit Treasury Department Form 90-22.1 could draw a $500,000 fine and up to 10 years for in prison. Tax evasion, he said, is liable to a $250,000 fine and up to five years. Failing to file a tax return attracted a $100,000 fine and up to one year imprisonment.

Following the presentation, Mr. Cantor, alongside Mr. McTaggart and KPMG partner and "head of tax" Doug Harrell, heard an hour of eager audience questions, most related to complex personal circumstances.

Mr. Cantor told one interlocutor that renouncing U.S. citizenship is unlikely to be effective: "First, you have to have another passport before you can do that. You cannot be stateless."

An "exit tax" would also apply, he said, describing a law that "started when a certain resident here [Cayman] came from Belize." Someone seeking to expatriate themselves, he said, could be forced to sell their assets, relinquish any trusts and pay state taxes.

"Until the State Department gives you a certificate [of expatriation], you cannot relinquish your passport, not until all your taxes are paid."

Source

Yep, a goldmine for tax attorneys and accountants. It's become very expensive to document the honest fact you don't owe the government any money.

This is not going to fix the US financial problem.

More effective I think would be to invite the money into the country because it is easy to comply, easy to do business, easy to understand tax codes.

Most people do not know that you can actually set up financial privacy and anonymous banking right in the U.S. but there are cases where offshore is right, especially for U.S. expats who live overseas.

MakingProphets
Posted By: Bear Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 10/08/13 10:27 PM
FBAR is filed with the US Treasury not with the IRS...the IRS as well as BATF, DEA, has access to the information if they choose to request it. Been through filing several times. We report everything and never a peep or hassle...not saying I like it but its been fairly easy to comply.

I should also mention that some friends were recently informed by the Director of the IT Dept of the GOB that all income regrdless of source was to be aggregated to determine income realtive to the $75KBz Belizean Business Tax exemption level. Doesn't sound like grasping for a buck is exclusive to the US...or perhaps considering FACTA it's tit for tat?
Posted By: Marty Re: NEW US TAX LAW - FATCA - "VERY AMBITIOUS" - 11/07/13 09:51 AM

BCCI: Info Bulletin - Updated information on the United States - Foreign Account Tax Compliance Act (FACTA)

The U.S. Embassy in Belize has shared the following latest release from the IRS. It is the draft agreement and rules for foreign financial institutions (FFI) to report the necessary FATCA information to the IRS. Please click these links to find out more:

http://www.treasury.gov/press-center/press-releases/Pages/jl2194.aspx

http://www.irs.gov/pub/irs-drop/n-13-69.pdf

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