Press Room: Tax Release
IRS Cuts (A Little) Slack on FATCA
On April 2, Internal Revenue Service (IRS) made several positive announcements relating to FATCA (Announcement 2014-17). These include:
Extension of Filing Deadline - A 10 day extension (to May 5) of the deadline for offshore funds and other foreign financial institutions (FFIs) to complete their FATCA registration in order to be included on the first IRS published list of FATCA compliant FFIs.
IGA Relief - Relief for offshore funds and other FFIs that are organized in jurisdictions (e.g., the British Virgin Islands) that have agreed in substance to the terms of an Intergovernmental Agreement (IGA), but have not yet formally signed such IGA1. FFIs in those jurisdictions can register on the IRS FATCA portal as FFIs that are covered by such IGA and will be permitted to certify their status to withholding agents consistent with such status. Such certification, in effect, extends the effective date for the withholding obligations under FATCA from July 1, 2014 to January 1, 2015.
1At present, the United States has signed 26 IGAs and has 19 IGAs that are agreed in substance but not signed.