FATCA has been implemented, but it is not strong many groups still harboring strong political and legal animosity. FATCA is now legally in force, but the Treasury department is promising “to go easy” on enforcement for the first two years since delays and high costs leave many areas of the world still unable to fully comply with FATCA. FATCA has greatly increased global concern over the use of foreign accounts to evade government taxation, yet there is still conversation as to whether this is the correct solution to solve the problem or if it will just cause more damage to the United States and innocent, tax abiding Americans.
Before the implementation of FATCA there was a surge of countries entering into intergovernmental agreements (IGAs). Each country reached their own agreement with the Treasury. A huge benefit for countries is that they are now able to monitor their own citizen’s financial activities around the world and generate additional revenue. Both France and the UK have implemented their own laws to hinder hiding financial assets outside of their own countries.
There are open legal questions by opponents of FATCA if the unilateral IGAs violate the Senate’s treaty power, if FATCA’s excessive penalties violate the 8th Amendment, and if privacy protected by the 4th Amendment has been violated. Still, FATCA has raised global concern and the FATCA empire will not crumble easily with global support.
Despite the added complexity that FATCA has brought to numerous financial intuitions and tax payers, FATCA continues to roll forward. Similar to the continued fight of the war on drugs, there will always be individuals that attempt to circumvent the law to pursue their own agenda. Unfortunately, for those that have undisclosed assets outside their own countries and the financial institutions that are burdened by the cost of compliance, FATCA and the similar laws implemented by other countries are here to stay.
About Freeman Tax Law
Freeman Tax Law professionally handles all domestic and international tax law matters. At Freeman Tax Law, the attorneys and staff have vast experience with foreign tax compliance, international tax planning, and resolving tax controversies involving offshore banking matters. Freeman Tax Law helps taxpayers and foreign entities become in compliance with laws such as Foreign Account Tax Compliance Act (FATCA), Offshore Voluntary Disclosure Program (OVDP), and Streamlined filing procedure OVDP. In addition to handling complex tax controversies, the Freeman Tax Law team has extensive expertise in assisting clients with wealth management and estate planning.
Freeman Tax Law