U.S. extends time limit for FATCA
The U.S. has extended the time limit for compliance withFATCA, the reporting of its citizens’ financial accounts outside of the country,to the years 2014 and 2015.
The Treasury Department of the United States, through the inland revenue service (IRS) has announced that it will take into account the “good faith” of financial institutions outside the United States who will have to make adaptations in order to comply with the law and will not issue penalties for delays between 2014 and 2015.
A statement by Deloitte.com states that “The years 2014 and 2015 will now be considered as periods of transition and compliance with due diligence processes by the IRS …” “… And for review of compliance with Chapters 3 and 61, referring to reporting of information by foreign and domestic entities …”.
FATCA is a United States statute that requires United States persons, including individuals who live outside the United States, to report their financial accounts held outside of the United States, and requires foreign financial institutions to report to the Internal Revenue Service (IRS) about their American clients.
Congress enacted FATCA to make it more difficult for U.S. taxpayers to conceal assets held in offshore accounts and shell corporations, and thus to recoup federal tax revenues