FATCA requires all US citizens, green card holders, and other US persons for tax reasons to report their foreign bank accounts, as well as other non-US financial holdings to the IRS.

Certain U.S. taxpayers who hold financial assets outside the United States must report those assets to the IRS on Form 8938, Statement of Specified Foreign Financial Assets.

FATCA requires some U.S. taxpayers with foreign financial assets of at least $50,000 to report those assets on Form 8938 attached to the taxpayer’s annual income tax return. The reporting threshold is higher for certain individuals, like married taxpayers filing a joint annual income tax return and certain taxpayers living in a foreign country.

if you do not have to file a U.S. income tax return for the year, then you do not have to file Form 8938, regardless of the value of your specified foreign financial assets.

US President Barack Obama signed the Foreign Account Tax Compliance Act (FATCA) into law on July 1, 2014. FATCA requires non-US foreign financial institutions (FFIs) and non-US non-financial entities (NFFEs) to identify and disclose their US account holders and members or become subject to a new 30% US withholding tax for any payment of US source income and proceeds from the sale of equity or debt instruments of US issuers. (Learn more from the IRS here.)

This legislation is aimed at offshore tax evasion. Proposed to better identify US persons who use foreign financial accounts or foreign entities and provide more information to the IRS to enforce compliance.

A goal of FATCA is to increase transparency, enhance reporting and enable a mechanism for strong sanctions in the event of tax evasion. The United States may obtain information about offshore accounts and investments of US taxpayers.

Please note: EQIBank is unable to offer tax advice. For tax related questions please contact your professional tax advisor or refer to the IRS website. You can learn more by visiting the IRS website or contacting a professional tax advisor.

https://www.irs.gov/pub/irs-pdf/iw8.pdf

https://www.youtube.com/watch?v=HMqGRip5bWk

https://www.treasury.gov/connect/blog/Pages/Myth-vs-FATCA.aspx

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