On October 24, 2012 the IRS released Announcement 2012-42 relating to the implementation of various provisions under FATCA. This Newsbrief summarizes the key highlights from the Announcement.
On October 24, the Internal Revenue Service (IRS) released Announcement 2012-42 (the Announcement) relating to the implementation of various provisions under the Foreign Account Tax Compliance Act (FATCA). FATCA was enacted to prevent and detect offshore tax evasion by US taxpayers.
The FATCA regime imposes substantial new due diligence requirements on foreign financial institutions (FFIs) related to holders of financial accounts, and requires reporting and withholding in certain circumstances.