Tag Archives: foreign trusts

The IRS & Offshore Trusts: FATCA

March 03, 2016  |   Posted by :   |   FATCA/FBAR   |   1 Comment

On March 18, 2010, President Obama signed the Hiring Incentives to Restore Employment Act (“HIRE”) Act (P.L. 111-147, the “Act”) which included the Foreign Account Tax Compliance Act (“FATCA”) which contained new foreign account tax compliance rules. Under the Act, new reporting and disclosure requirements for foreign assets were phased in between 2010-2014. Under FATCA: […]

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Foreign Persons – U.S. Tax Withholding – Nonresident Aliens

February 07, 2013  |   Posted by :   |   International Tax Planning   |   0 Comments

Withholding Agents: Withholding Agents are third parties required to withhold income tax on U.S. source income they pay to: 1. Foreign persons (including non-resident aliens); 2. Foreign corporations; 3. Foreign partnerships; 4. Foreign trusts; 5. Foreign estates; 6. Foreign governments; and 7. International organizations. Withholding agents are responsible for: 1. Withholding on various types of […]

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FBAR Filings – Trusts

January 09, 2013  |   Posted by :   |   FATCA/FBAR   |   0 Comments

Each US Trustee of a trust account must file a FBAR (even if the beneficiary of the trust is not a US Person). If the owner of an account gave someone the power of attorney over the account, both the owner and the attorney-in-fact must file a FBAR (if both are US Taxpayers). If a […]

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FBAR Criminal Penalties: Willful Failure to File

January 07, 2013  |   Posted by :   |   FATCA/FBAR   |   0 Comments

Under IRS Form 1040, at the bottom of Schedule B, Part III, on Page 2, Question 7(a) states: “at any time during the previous year, did you have any interest in or signatory or other authority over a financial account in a foreign country, such as a bank account, a security account, or other financial […]

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FACTA – Penalty for Failure to Report

January 04, 2013  |   Posted by :   |   FATCA/FBAR   |   0 Comments

The minimum amount of penalty for failure to report information or file returns for foreign trusts is increased to $10,000. If any notice or return required to be filed under IRC §6048 is not filed on or before the due date, or does not include all the information that is required, or includes incorrect information, then the person […]

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FATCA – Reporting Requirements for U.S. Persons Treated as Owners of a Foreign Trust

January 03, 2013  |   Posted by :   |   FATCA/FBAR   |   0 Comments

A U.S. Person who is treated as the owner of any portion of a foreign trust under the grantor trust rules, must submit any information required by the IRS with respect to the foreign trust (in addition to the current requirement that such U.S. Persons are responsible for insuring that a foreign trust complies with […]

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FATCA – Uncompensated Use of Foreign Trust Property

January 03, 2013  |   Posted by :   |   FATCA/FBAR   |   0 Comments

The uncompensated use of foreign trust property by a U.S. Grantor, a U.S. Beneficiary, or a U.S. Person related to either of them is treated as a distribution by the trust for non-grantor trust income tax purposes (which also includes the loan of cash or marketable securities by a foreign trust or the use of […]

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FATCA – Foreign Trusts Treated as Having U.S. Beneficiaries

January 03, 2013  |   Posted by :   |   FATCA/FBAR   |   0 Comments

For purposes of treating a foreign trust as a grantor trust, there is a rebuttable presumption that the trust has a U.S. beneficiary if a U.S. Person transfers property to the trust. An amount is treated as accumulated for a U.S. Person even if that person has a contingent interest in the trust. A foreign […]

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IRS Form 8938 – Statement of Specified Foreign Financial Assets

October 17, 2012  |   Posted by :   |   FATCA/FBAR,International Investors   |   0 Comments

“FATCA” Tax Reporting Under the Foreign Account Tax Compliance Act (“FATCA”) for tax years beginning after March, 18, 2010, specified persons (i.e. U.S. Citizens, resident aliens), who have an ownership interest in specified foreign financial assets (i.e. foreign financial accounts, foreign stock, any interest in a foreign entity) must file Form 8938 (attached to their […]

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FBAR – Revised Form TD F 90-22.1

June 07, 2012  |   Posted by :   |   FATCA/FBAR   |   0 Comments

In October 2008, the IRS issued a revised version of TD F 90-22.1 “Report of Foreign Bank and Financial Accounts (“FBAR”). The revised FBAR form states: “Do not use previous editions of this form after December 31, 2008”. All FBAR’s due for Tax Years 2008 (forward) and back year FBAR’s (unfiled) are to be reported […]

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