IRS Giving Financial Institutions More Time To Certify Accounts Under FATCA

The IRS has released Notice 2016-8, which will give foreign financial institutions more time to certify whether their pre-existing accounts are owned by U.S. taxpayers under FATCA (the foreign account tax compliance act).  The January 19th notice states that some foreign financial institutions won’t have to submit pre-existing account certifications until they give the US their first periodic certification that they are complying with the law.  The IRS refers to this as a “deferral of the submission date.”  The IRS stated that this applies to participating financial institutions and those who are reporting to the United States under a Model 2 intergovernmental agreement.

The IRS notice specifically states that a compliance certificate must be submitted on or before July 1 of the calendar year following the certification period, instead of no later than six months following the end of the certification period.

The IRS has stated that in this notice that it plans to amend existing regulations under Chapter 3 and Chapter 4 with these and other changes, but taxpayers can rely on this notice for now.

 

You can read more about Notice 2016-8 on the IRS website.