IRS Issues Proposed Regulations for FATCA Implementation

The Treasury Department and the Internal Revenue Service issued on February 8 proposed regulations for the next major phase of implementing the Foreign Account Tax Compliance Act (FATCA). The proposed regulations implement FATCA’s obligations in stages to minimize burdens and costs consistent with achieving the statute’s compliance objectives. Written or electronic comments must be received by April 30, 2012.  You can read the full proposed regulations at http://www.irs.gov/pub/newsroom/reg-121647-10.pdf.

The law targets non-compliance by U.S. taxpayers using foreign accounts. IRS Commissioner Doug Shulman said when making the announcement, “FATCA strengthens U.S. efforts to combat offshore noncompliance. In doing so, we understand it creates a significant undertaking for financial institutions. Today's proposed regulations reflect our commitment to take into account the implementation challenges of affected financial institutions while allowing for a smooth and timely roll-out of the law." More information about FATCA is available at http://www.irs.gov/businesses/corporations/article/0,,id=236667,00.html.

Treasury and IRS will continue to work closely with businesses and foreign governments to implement FATCA effectively. Information about how to comment on the proposed regulations as available at http://www.irs.gov/newsroom/article/0,,id=254068,00.html.