There are a lot of new acronyms in the world of international taxation. What do CRS GATCA and the OECD have to do with FATCA and offshore bank accounts? What impact has FATCA had upon other sovereign entities around the world? If are a US taxpayer and you have offshore bank accounts, investment accounts, foreign corporate ownership, assets, real estate or income your world is changing. There are fewer and fewer offshore tax havens, and the reality is simple: soon there won’t be any way to hide money, assets and income from the IRS.
FATCA was not initially a welcome initiative by the United States. However, after watching the successful impact and the wave of new tax revenues streaming into US coffers, the international community has come to understand the value of global financial transparency. It simply means more tax revenues for any sovereign nation. In response to FATCA and the information required by the United States, many countries through the Organization for Economic Co-operation and Development (OECD) have developed a global version of FATCA called the Common Reporting System or CRS. CRS is more widely known as “GATCA” a bit of a sarcastic twist on Global FATCA.
US taxpayers with offshore accounts, assets and income take heed. The CRS or GATCA requires financial institutions from participating countries to provide taxpayer information to other participating countries based on taxpayer residency. Sovereign nations around the world have agreed to require banks, financial institutions, foreign corporations and foreign trusts, as well as other asset holders such as real estate owners and investors to require “beneficial ownership identification” for every financial asset, account, instrument, transaction or entity. The nations of the world have agreed to tie the beneficial ownership identification – specific taxpayer identification or national registration numbers (i.e. passport number, social security number, federal tax ID, etc.) to establish the actual person or persons who have control and ownership of an account, entity or asset.
CRS GATCA and the OECD have joined the United States in a mission to clearly identify every individual person (and their nation of residence) who has a beneficial ownership or interest in any financial account, entity, asset or instrument and share that information with every other member nation.
The software and computer systems make this task easy. The international treaties under FATCA CRS GATCA and the OECD require your bank, your investment house and the governmental entity where your home or commercial building or your foreign corporation exists to pursue you and obtain proof of your identity and the extent of your ownership. You have probably begun to receive letters from your offshore bank or a government agency requesting specific information such as passport identification and your residential taxpayer identification number (social security number). This will be provided to the IRS along with all of the information about your offshore bank accounts, investments, ownership in foreign corporate entities or trusts and real estate holdings.
The US government and the IRS are requiring you to come into FBAR compliance and the disclosure of all offshore assets, accounts and income. If you do not make a voluntary disclosure, the IRS and the US Justice Department have promised harsh consequences. Allen Barron and our seasoned tax attorneys, accounting and legal professionals can guide you through this process. We can discuss your options – OVDP and Streamlined Procedures – and the best strategy for you to avoid heavy and harsh financial and criminal penalties that await. We invite you to call 866-631-3470 for a free consultation, and to discuss the protections of the attorney-client privilege that will safeguard you so that you may freely disclose your unique circumstances and gain insight, advise and expert counsel in total safety. You cannot disclose this information to a CPA, tax preparer or financial adviser without fear of an IRS subpoena.