FATCA is major issue for US expats !
As America goes to the polls to decide its next president, one of the Obama administration’s most controversial pieces of legislation, the Foreign Account Tax Compliance Act, known by its acronym ‘FATCA’, is once again generating headlines.
One of FATCA’s most outspoken critics, Peter Dunn, the founder of the web-based American expat discussion platform, the Isaac Brock Society, who renounced his US citizenship last year, tells iexpats.com today that FATCA has effectively exiled him from his land of birth.
“I could conceivably be charged with failure to file FBARs [treasury forms which need to be filed annually] that the US required while I was still a US citizen. I am therefore now wondering if I will be arrested if I return to the United States,” he says.
Like a growing number of the 6 million US expats, Dunn feels that FATCA, which requires foreign financial institutions (FFIs) to declare the financial activities of their American clients to the US Internal Revenue Service (IRS), pushes overseas finance organisations into acting as ‘defacto’ snooping agents for the IRS. I’m inclined to agree.
As he points out in iexpats.com article, FATCA not only adversely affects American expats due to its complex and costly reporting and because they are being turned away by FFIs, it could also jeopardise the fragile US economy and that it breaches several major international agreements.
As such, on the Isaac Brock Society site today, Dunn is urging Americans to make their disdain for FATCA felt in the elections.
He comments: “While campaigning, Obama said to a crowd booing Romney, ‘Get revenge. Vote.’ Well, US expats who have suffered the indignities of beingtreated like criminals without probable cause through the requirement of revealing private information, threats of imprisonment and excessive fines, can get revenge.”
Whether its Barack Obama or Mitt Romney who wins the keys to the White House, and at this stage it’s looking like it’ll be a fight to the finish, the effects of FATCA on American expats and foreign financial institutions and governments across the world will continue long after the last vote is counted.
Nigel Green deVere Group Blog written on 6th of November