On March 9, 2017, the Organization for Economic Cooperation and Development (OECD) issued new model disclosure rules that require lawyers, accountants, financial advisors, banks and other service providers to inform tax authorities of any schemes they put in place for their clients to avoid reporting under the Common Reporting Standard (CRS) or to prevent the identification of the beneficial owners of entities or trusts. Attorneys around the world who have a license to practi

It is clear that you must retain records under FATCA and CRS but for how long and when does the clock start ticking? Taking the most conservative approach across FATCA, IGAs and CRS, your record-keeping policy should require a minimum of 6 years of record retention. FATCA Regulations Generally, the FATCA regulations (which non-IGA jurisdictions must follow) require that books and records be retained as long as their contents may become material in the administration of any U

Starting this month, the Internal Revenue Service (IRS) will notify the U.S. Department of State (State Department) that an individual has a “seriously delinquent tax debt.” The result of this notification is that the State Department will generally deny an application for issuance or renewal of a U.S. passport from the seriously delinquent taxpayer. The State Department may also revoke or limit a passport previously issued to the taxpayer. Who Is Impacted? Taxpayers impact

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

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

The Inland Revenue Authority of Singapore (IRAS) issued a reminder to financial institutions that an entity that is or becomes a Reporting Singapore-based Financial Institution (SGFI) at any time between January 1, 2017 and December 31, 2017 must apply for Singapore Common Reporting Standard (CRS) registration by March 31, 2018. IRAS also announced limitations on third-party reporting services and sub-fund FATCA deregistration requirements. Service Provider Limitations A Repo

This week the IRS announced several IRS Large Business and International division tax compliance campaigns. Two of these campaigns impact FATCA compliance. To help you decipher the IRS description of the two campaigns, I have broken down some of the terminology used in the IRS announcement. Form 1120-F Chapter 3 and Chapter 4 Withholding Campaign The IRS described this campaign as: “designed to verify withholding at source for 1120-Fs claiming refunds. To make a claim for r

FATCA vocabulary has become second nature to those of us actively working on FATCA-related issues. However, clients and newcomers to the world of FATCA may not have a complete understanding of the lexicon. Certain terms are of critical importance especially the words “Responsible Officer” which is frequently abbreviated as “RO”. What Is a “Responsible Officer”? An RO is the individual in charge of overseeing a Participating Foreign Financial Institution’s (PFFI’s) complianc

Please see my new training programs page on my site. The programs cut across my specialties in: Managing legal issues in foreign subsidiaries in life sciences, consumer goods and other industries; and Advising the financial industry on FATCA & CRS. Given my significant in-house counsel background, I understand the practical training needs of a corporation. I do not rattle off an outline of a statute. Instead I break down a subject area into a relevant discussion for the s

FBAR which stands for Foreign Bank and Financial Accounts Report is an annual report that provides the U.S. government with information regarding certain foreign financial accounts. This may sound a lot like FATCA, CRS, BEPS and the rest of the financial transparency acronyms that have been flying around. However, it is a different transparency regime with potential civil and criminal penalties if your employees fail to file. What Is FBAR? FBAR is part of the U.S. Bank Secr

FBAR which stands for Foreign Bank and Financial Accounts Report is an annual report that provides the U.S. government with information regarding certain foreign financial accounts. This may sound a lot like FATCA, but it is a different transparency regime. What Is FinCEN? FBAR has been around since 1970 with responsibility for the program assigned to the U.S. Financial Crimes Enforcement Network (FinCEN) which is a bureau of the U.S. Department of the Treasury. FinCEN’s go

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

The Cayman Islands issued a reminder to Financial Institutions that the deadline for the submission of US FATCA and CRS reports and CRS Filing Declarations is today August 31, 2017. Although the deadline for registration was July 31, 2017 and the deadline for registration/notification is August 31, 2017, the Cayman Islands is keeping its portal open until September 13, 2017. Specifically, the portal will be open until 4 P.M. on September 13, 2017: New York 5 P.M. / London 1

Reporting is almost over and you can take a breath. You followed FATCA, IGA, CDOT and CRS requirements in your reporting and due diligence. But did you document these processes? If not, you may still be subject to penalties. FATCA, CDOT and CRS each seeks to create transparency in taxation across jurisdictions. The local tax authority collects certain information through the reporting process and shares that information with relevant tax authorities. It is incumbent on th

The British Virgin Islands tax authority announced that it has extended the deadline for UK FATCA/CDOT and Common Reporting Standard (CRS) reporting to September 1, 2017. This extension applies to UK FATCA/CDOT and CRS. The extension does not apply to FATCA. For assistance, please contact me via my contact page or at elizabeth@elizabethmcmorrowlaw.com .

The Cayman Islands announced yesterday that its AEOI portal will continue to accept Financial Institution (FI) registrations and variations to existing FI registrations until August 31, 2017. The Department for International Tax Cooperation (DITC) warned that it is possible that fines may be levied against those that did not meet the July 31, 2017 deadline. Additional fines may be levied if an FI fails to register prior to August 31, 2017. Please note that it is necessary to