FATCA Final Rules Exclude Foreign Trusts with Individual Trustees – Los Angeles Income Tax Planning and Asset Protection Planning Attorney Bruce Givner

by Bruce Givner on April 18, 2013

As previously reported, the U.S. Department of the Treasury (DOT) and the Internal Revenue Service (IRS) recently issued final regulations for the Foreign Account Tax Compliance Act. Included among the regulations is a little gem for certain foreign trusts.

Under the final regulations, foreign trusts that are passive entities and managed by an individual, not a corporate, trustee will not be treated as a foreign financial institution for purposes of FATCA. Further, the fact that an individual trustee is paid will have no relevancy.

Under FATCA, foreign financial institutions (FFIs) are subject to FATCA registration requirements and must register as an investment company. FFIs are also required to provide account information to the IRS for U.S. taxpayers, or foreign entities in which U.S. taxpayers hold a substantial ownership interest. FFIs who fail to timely report will be subject to severe withholding penalties.

Givner & Kaye focuses on sophisticated income tax planning and compliance, tax litigation and procedure, estate planning, and asset protection plans for individuals and businesses in Beverly Hills, Calabasas, West Los Angeles, Hollywood, and other areas of Los Angeles, Orange, Ventura, San Bernardino, Riverside and Santa Barbara Counties. Call Los Angeles Estate Planning and Asset Protection Plan Attorneys Givner & Kaye at (310) 207-8008 today.

Leave a Comment

Previous post:

Next post: