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February 07, 2013

The Impact of the Foreign Account Tax Compliance Act on International Investments

The tax attorneys at Nardone Law Group routinely advise Ohio taxpayers about the Internal Revenue Service’s Offshore Voluntary Disclosure Program and the impact of Foreign Account Tax Compliance Act on taxpayer's investments.

The Treasury Department announced on January 17, 2013 that Norway has now joined the ranks of countries which have signed or initialed model agreements that facilitate the effective and efficient implementation of the Foreign Account Tax Compliance Act (FATCA). The United Kingdom, Mexico, Denmark, Ireland, Switzerland, and Spain preceded Norway as countries that have signed or initialed model agreements. Treasury reiterated that it is engaged with more than 50 countries and jurisdictions to curtail offshore tax evasion, and more signed agreements are expected to follow in the near future.

FATCA was enacted as part of the Hiring Incentives to Restore Employment (HIRE) Act in March 2010. The legislation, which is designed to reduce tax evasion, is generally effective for tax years beginning after 3/18/10, the date of enactment. According to the former IRS Commissioner Shulman, the IRS pushed for and obtained passage of FATCA to meet the broad array of challenges that the IRS faces in the international arena.  Thus, the IRS is focused on a multi-year international tax compliance strategy that is tailored for both corporate and individual taxpayers. For individuals, what this means, is that the IRS wants to ensure that US taxpayers with overseas assets pay what they owe.  According to the IRS, rooting out individuals hiding their money in bank secrecy jurisdictions is very important and the IRS is committed to that effort.  Thus, the cooperation of various companies through the signing of model FATCA agreements advances the IRS's cause in the international tax enforcement arena.

Nardone Law Group represents businesses and individuals in federal and state tax issues, including the Internal Revenue Service's Offshore Voluntary Disclosure Program. If you have an undisclosed foreign account or entity, you should contact an experienced tax attorney today. Nardone Law Group’s tax lawyers and professionals have vast experience representing clients before the IRS. Our experienced tax lawyers will thoroughly review your case to determine what options and alternatives are available, including the Offshore Voluntary Disclosure Program. Contact us today for a consultation to discuss your case.

To read more about the Offshore Voluntary Disclosure Program, please see our recent blog posts on the subject, specifically related to Foreign Mutual Funds and the National Taxpayer Advocate's Opinion.

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« The Impact of Identity Theft on Taxes | Main | Recent Tax Court Opinion Highlights Need to Substantiate Gambling Losses »

February 07, 2013

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