Thanksgiving was quite a feast for the US Treasury Department. On November 26, 2013, the US and Costa Rica signed a bilateral agreement to implement the Foreign Account Tax Compliance Act (FATCA) and on November 28, 2013, the US and the Cayman Islands signed a bilateral agreement to implement FATCA. The Costa Rican agreement is…
DetailsAs we approach the end of 2013, with the House scheduled to be in session for less than three more weeks this year, it appears highly unlikely that we will see any comprehensive U.S. tax reform in 2013. This provides numerous opportunities for taxpayers, because many techniques for tax minimization are likely to remain available,…
DetailsUS TAX SURPRISES AND REPORTING REQUIREMENTS SERIES If you are a US person (citizen or resident) you may have learned by now that you have to file a US tax return and bank report each year, even if you have no US source income. Well, that’s not all. This is the first in a series…
DetailsOn November, 14 2013, the US and France signed a bilateral agreement to implement the Foreign Account Tax Compliance Act (FATCA). The agreement is based on the Model 1A treaty and requires French financial institutions to report US account holders to the French government, which will then report those accounts to the US. Similarly, US financial institutions are required…
DetailsOn October 29, the IRS published Notice 2013-69 (the Notice) which provides guidance to Foreign Financial Institutions (FFI’s) seeking to enter into FFI Agreements with the Internal Revenue Service (IRS) to comply with their Foreign Account Tax Compliance Act (FATCA) obligations. While the majority of the Notice is dedicated to providing a draft FFI Agreement,…
DetailsOn July 12, 2013, the US Treasury Department issued Notice 2013-43 which extended the implementation deadline of most FATCA rules for an additional six months. This has moved the general implementation deadline for FATCA from January 1, 2014 to July 1, 2014. Still, US persons holding foreign accounts will be impacted by FATCA sooner rather…
DetailsRodriquez v. Commissioner, No. 12-60533 (July 5, 2013), aff’g 137 T.C. 14 (2011) ruled recently on whether inclusion of income under sections 951 and 956 (951 Inclusions) of the Internal Revenue Code (IRC) may qualify for the preferential tax treatment afforded to qualified dividends, as defined by section 1(h)(11) of the IRC. The Fifth Circuit…
DetailsUS persons are required to file Form 3520 if they create, transfer money to, receive distributions from, or are the owners of a foreign trust. While there is no tax liability associated with Form 3520, it is a complicated form and can be quite time consuming and expensive to prepare. As such, people avoid filing…
DetailsThe Foreign Account Tax Compliance Act (FATCA) requires foreign financial institutions and US persons who hold certain foreign accounts to report these accounts to the US. One of the most common types of account that must reported is the depository account. However, the definition of depository account changed significantly from the proposed regulations to the final regulations.
DetailsThe US Department of Treasury announced that the US and Spain signed a Protocol to their bilateral income tax treaty (the Treaty). The Protocol includes twenty-six pages of addenda and revisions to the Treaty. The Department of Treasury highlighted some of the Protocol’s changes to the Treaty: 1) the Protocol provides for “exclusive residence-country” taxation…
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