On December 3, 2012, the US and Switzerland initialed a bilateral agreement to implement Foreign Account Tax Compliance Act (FATCA) (the agreement must still be approved by the Swiss Parliament). Previously, on November 20, 2012, Spain announced that it had agreed to a bilateral agreement implementing FATCA and on November 19, 2012, the IRS announced that the US and Mexico have signed a bilateral agreement to implement FATCA. These three announcements come just days after the November 14, 2012 announcement that the US and Denmark signed a similar bilateral agreement to implement FATCA. With the addition of the standing treaty with the United Kingdom, there are now five countries with specific bilateral FATCA agreements. The US and Canadian tax treaty already includes information sharing, so it is not clear whether a specific FATCA agreement is being pursued between Canada and the US.
Expect more announcements of bilateral agreements implementing FATCA in the near future. The IRS is pursuing these information sharing agreements with over 50 countries, and it appears more and more foreign countries are going to sign these agreements. US citizens living and banking abroad should pay close attention to this trend and its implications for those who are not up-to-date with their US tax and bank account reporting compliance.