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Six More FATCA Agreements Inked by U.S.

The United States has signed 6 more agreements with other nations and territories implementing the Foreign Account Tax Compliance Act. This act is meant to serve as a method to ensure that American taxpayers are not evading their taxes by placing their money in offshore accounts that ordinarily are outside the purview of the federal government. The six agreements signed were with Malta, the Netherlands, Bermuda, and the U.K. Crown Dependencies of Jersey, Guernsey, and the Isle of Man.

Financial institutions in countries that have acceded to agreements with the Treasury Department would have to hand over detailed account information on their American clients to the IRS, or alternatively, to their respective governments who then forward it to the U.S. government.

At issue, however, is the fact that there are no final regulations in place yet; proposed regulations were issued in October. With more countries and agreements in the pipeline, it is becoming increasingly difficult and complicated to implement FATCA when there are no fixed rules and regulations to govern the entire process. Until such time, it remains to be seen how effective this program will be. Nevertheless, the model of FATCA is beginning to be hailed as a global standard by many other governments who also wish to recapture taxes held in offshore accounts.

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