FATCA for Individuals
FATCA requires U.S. taxpayers who hold foreign financial assets with an aggregate value of more than the reporting threshold (at least $50,000) to report information about those assets on Form 8938, which must be attached to the taxpayer’s annual income tax return. The reporting threshold is higher for certain individuals, including married taxpayers filing a joint annual income tax return and certain taxpayers living in a foreign country
In addition, under FATCA, US taxpayers with specified foreign financial assets that exceed certain thresholds must report those assets to the IRS. This reporting will be made on Form 8938, which taxpayers attach to their federal income tax return.
This will impact you if:
⊗ You are a US Citizen who has any form of investment held outside the US
⊗ You are a US Citizen living outside the US who has not routinely filed annual tax returns as required by law
⊗ You have not participated in any former or current voluntary disclosure program
⊗ You have any investments in an FFI that chooses not to be FATCA compliant
What does this mean for for you?
It is the obligation of the individual to ensure ‘true and accurate’ returns and forms are filed with the IRS on time so as to avoid penalties or in some cases, criminal prosecution. With the implementation of FATCA and other tools, the IRS has developed for finding non-compliant taxpayers, time is running out if you are not up to date with your filings. In addition, many banks and other foreign financial institutions will no longer be able to retain you as a client.