The Treasury Department and the Internal Revenue Service said Wednesday they will treat 19 countries that have reached agreements in substance with the U.S. on the Foreign Account Tax Compliance Act as having those agreements in effect, until the end of 2014, and they will also delay the registration deadline for foreign banks for 10 more days.
FATCA, which was included as part of the HIRE Act of 2010, requires foreign financial institutions to report on the holdings of U.S. citizens to the IRS or else face stiff penalties. The law has provoked controversy in many countries, which have complained that it would violate their privacy and banking secrecy laws. To help ease implementation, the Treasury has been negotiating intergovernmental agreements with a host of different jurisdictions, but only 26 of them have been finalized ahead of one of the main deadlines, which is coming up in July (see Multiple FATCA Deadlines Approaching). The announcement on Wednesday means that the ones who have not yet reached the final stage will be treated as if they have.
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