The following Facts about FATCA will talk about the federal law in United States for enforcing the US citizens who live in United States and outside United States to file the yearly report related to financial accounts to FINCEN. FINCEN stands for Financial Crimes Enforcement Network, while FATCA stands for Foreign Account Tax Compliance Act. All non-U.S. foreign financial institutions are required to report the identities and assets of a US person status to the Department of Treasure of United States. Let us find out interesting facts about FATCA below:
Facts about FATCA 1: the purpose
The purpose of FATCA was to trace the non-US financial accounts of the US taxpayers.
Facts about FATCA 2: the non-US assets
The non-US assets owned by the United States citizens might be in the forms of legal immigrants, dual citizens and astute investors.
Facts about FATCA 3: the US citizens who live outside the country
It was believed that 9 million citizens of United States live outside the country. They are still subject to pay taxes to US.
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Facts about FATCA 4: the asset reports
The US person who has the non-US asset will be identified through reporting the assets of the non-US entities like volunteer organizations and non-US companies.
Facts about FATCA 5: the intergovernmental agreements
The intergovernmental agreements (IGA) are implemented by US and other countries. The local government will receive the information related to the US person data.
Facts about FATCA 6: the country with IGA
One of the countries with IGA is Ukraine. The Ukrainian government will send the US person data to the United States.
Facts about FATCA 7: a non-IGA country
A country with non-IGA is North Korea. The US person data will be kept by the North Korean Bank before it will be sent to IRS.
Facts about FATCA 8: crosscheck
The data gathered by FATCA will be used to crosscheck the data reported by the US person at FINCEN.
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Facts about FATCA 9: the responsibility
The US persons have the responsibility to report their non-US assets to FINCEN even though they have dual citizenship or live outside United States.
Facts about FATCA 10: IRS
The persons also have the responsibility to report the assets to IRS by filling the form 8938. Taxing in United States is unique for it is also applied to the non-resident citizens.
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