ELIZABETH A. McMORROW LAW LLC

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FATCA: Who Must Report by March 31?

Elizabeth McMorrow

Mar 12, 2020

FATCA: Who Must Report by March 31?

The deadline for a Participating Foreign Financial Institution (PFFI), including a Reporting FI under a Model 2 IGA to complete its FATCA reporting to the IRS is March 31. Most reporting preparation is focused on Cayman Islands, Luxembourg and other non-U.S. jurisdictions. However, there are also a significant number of FIs who must submit their FATCA reporting directly to the IRS. EAG Leads Generally, a United States FI (USFI) is not required to obtain a Global Intermediary

Elizabeth A. McMorrow

Oct 24, 2019

Foreign Trusts: South Dakota Regulators’ Tips

The South Dakota Trust Association hosted its third annual Fall Forum on October 17 & October 18, 2019. We were fortunate to have Scott Kelly, Deputy Director of Trusts, South Dakota Division of Banking and Jonathan Sanborn, Esq., Financial Institution Examiner, South Dakota Division of Banking provide helpful information during the “Guidance on Foreign Trusts” panel. South Dakota The South Dakota trust industry has over $500 billion assets under management (AUM). This numb

Elizabeth A. McMorrow

Oct 10, 2019

Foreign Trusts: Head to Sioux Falls October 17 & 18

The South Dakota Trust Association is hosting its third annual Fall Forum on October 17 & October 18, 2019 at Sioux Falls Convention Center. The Fall Forum will include a variety of speakers on both the local and national level addressing a wide range of topics relating to South Dakota and the broader trust industry. I will be the moderator of the “Guidance on Foreign Trusts” panel. We have a great line up on the panel: Scott Kelly, Deputy Director of Trust, South Dakota Di

Elizabeth A. McMorrow

Jun 12, 2018

FATCA: USFIs & Foreign Grantor / Non-Grantor Trusts' Mandatory IRS Certs

The first round of IRS compliance certifications begins this summer. The current deadline is likely October 2018: 90 days after the IRS deploys the certifications capability on the IRS FATCA Registration Portal. Make sure you do not overlook certifying U.S. Financial Institutions (USFIs) and Foreign Grantor / Non-Grantor Trusts. What Are the Certifications? There are two certifications: Certification of Pre-existing Accounts; and Periodic Certification. For an outline of th

Elizabeth A. McMorrow

Apr 6, 2018

Foreign Grantor Trust IRS Form 3520 Filing Date Changes

For tax years beginning after 2016, the due date for a U.S. person to file IRS Form 3520 has changed to the fifteenth day of the fourth month following the end of the U.S. person’s tax year. For those following a calendar year, (taking into account the Emancipation Day holiday) the deadline in 2018 is April 17, 2018. IRS Form 3520 U.S. persons engaging in transactions with a foreign grantor trust, such as transfers to, or distributions from the trust must file IRS Form 3520:

Elizabeth A. McMorrow

Dec 28, 2017

What Is a Foreign Grantor Trust?

A trust is established in a U.S. jurisdiction such as South Dakota and a South Dakota trustee is appointed. How could this trust be considered a non-U.S. trust? The short answer is the U.S. Internal Revenue Service (IRS) allows trusts to be created with a U.S. situs which the IRS will then treat as a foreign trust. There is no magic wand to achieve the foreign trust status. Instead, it requires that the trust satisfy certain IRS requirements in addition to any local state

Elizabeth A. McMorrow

Dec 26, 2017

New Filing Requirement for LLCs & U.S. Foreign Grantor Trusts

As of January 1, 2017, U.S. Limited Liability Companies (“LLCs”) that are wholly owned, directly or indirectly, by one foreign person, are required to file an annual return on IRS Form 5472. Foreign Grantor Trusts (FGT) are specifically included in the new regulation. Non-U.S. Person Treated as a U.S. Person The IRS considers a FGT to be a non-U.S. person or nonresident alien (NRA) for U.S. tax purposes. Previously, the FGT filed a return if it earned U.S. Effectively Connec

Elizabeth A. McMorrow

Sep 8, 2017

FATCA: Foreign Grantor Trust Classification Strategy

In the FATCA world, some trusts are Foreign Financial Institutions (FFIs) and some are Non-Financial Foreign Entities (NFFEs). For those trusts that are FFIs, there may be options under the FATCA regulations classifying and registering your trust for a Global Intermediary Identification Number (GIIN). Financial Institutions in the U.S. and in non-IGA jurisdictions apply the FATCA regulations. Although Model 1 and Model 2 IGAs offer a classification of Trustee Documented Tru