Another title I was going to use for this post was “One Foot Over the Border”
We are hearing a lot of noise right now about the amount of money coming into Panama from other sovereign nations in Europe and of course the US. I hear that it is a trend that started a few years ago but is just now starting to take off.
History has shown that having even one foot over the border can make the difference between losing everything, and coming out just fine. Internationalizing your assets is not always easy or convenient, but that doesn’t make it any less urgent that you do so. While there was a lot of concern in the US about the new ruling affecting overseas banking, the Internal Revenue Service is giving overseas banks an additional year before they will have to make any withholdings from U.S. customers who fail to disclose enough identifying information to U.S. tax collectors.
A Bloomberg article this week discussed the extension of the IRS ruling affecting overseas banking and the regulations that are going to turn “U.S. citizens into pariahs once the regulations take effect”. I know of a number of banks here in Panama who will not even accept applications from US Citizens since this ruling. While this delay will give people a chance to organize finances and plan their strategies should they want to set up accounts in other sovereign nations, it will also open up another ring in the circus in Washington for lobbyists who oppose the ruling. As stated in the article “The way this new law is structured is totally disproportionate and unworkable, the equivalent of using a bulldozer to destroy an ant hill,” Jackie Bugnion, ACA’s director (American Citizens Abroad, a coalition of U.S. citizens living overseas), said in an e-mailed statement.
The Internal Revenue Service is giving overseas banks an additional year before they will have to make any with-holdings from U.S. customers who fail to disclose enough identifying information to U.S. tax collectors.
The second round of IRS guidance issued today on the Foreign Account Tax Compliance Act, or FATCA, doesn’t require banks to make 30 percent with-holdings on non-compliant U.S. customers until Jan. 1, 2014. Other with-holdings on gross proceeds and income that might be indirectly sourced to the U.S. won’t start until Jan. 1, 2015.
The requirements, which Congress approved last year, were originally slated to take effect at the beginning of 2013. Today’s announcement is intended to address the concerns of overseas financial institutions, including Toronto-Dominion Bank (TD) of Canada, Allianz SE (ALV) of Germany and Aegon NV (AGN) of the Netherlands, which have said the proposal is too complex.
“Today’s notice is a reflection of our serious commitment to implementation of the statute, but also a serious commitment to listen to the implementation challenges of affected foreign financial institutions,” IRS Commissioner Doug Shulman said in a press release. Yeah right!
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All I can say is that if you want to save yourself from the problems of excess government in the US, this is the place to come. I agree totally with Tom Brymer. Let the socialist/progressives stew in their own juice. Our government here is in good hands.