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View Full Version : FATCA Compliance package, the IRS and your foreign bank account



Bruce Z
04-07-2014, 03:53 PM
Am I the first to get a little package from my bank MCB requesting documentation of my SSN, what my bank account is being used for, source of funds, amounts going in and out? I'll bet most people don't expect our local bank to have to comply with US tax law and don't expect to see a release to allow them to disclose information about it to the IRS, but it's coming if you haven't got it already. I'm pretty sure if you don't provide the required response they will close your account, or they will be required to withhold 30% of incoming payments to your account. I knew this was coming (international tax compliance is part of my job) but thought it might be good to make people aware of it.

The Foreign Bank Account Report has always been required if you had over $10,000 in your foreign bank account, and now that the IRS will get notice of what accounts you own directly from the bank, it may be a good time to be sure you are in compliance on the FBAR reporting. The FBAR form was called the TD F 90-22.1 and is now called FinCEN 114 and must be filed electronically.

kob
04-07-2014, 04:10 PM
We opened accounts at MCB Hato about 3 weeks ago and were asked a lot of those kinds of questions as part of the process. It was a bit disconcerting at first, but Maureen explained why they needed the info (money laundering & US compliance). Quite unlike the ease of opening a bank account here in the US, but not a big deal in the end.

parachute
04-08-2014, 03:26 AM
Does MCB (or other Bonairean bank) have any FDIC-like backing?

Dee
04-27-2014, 11:19 AM
Am I the first to get a little package from my bank MCB requesting documentation of my SSN, what my bank account is being used for, source of funds, amounts going in and out? I'll bet most people don't expect our local bank to have to comply with US tax law and don't expect to see a release to allow them to disclose information about it to the IRS, but it's coming if you haven't got it already. I'm pretty sure if you don't provide the required response they will close your account, or they will be required to withhold 30% of incoming payments to your account. I knew this was coming (international tax compliance is part of my job) but thought it might be good to make people aware of it.

The Foreign Bank Account Report has always been required if you had over $10,000 in your foreign bank account, and now that the IRS will get notice of what accounts you own directly from the bank, it may be a good time to be sure you are in compliance on the FBAR reporting. The FBAR form was called the TD F 90-22.1 and is now called FinCEN 114 and must be filed electronically.

Hey Bruce,
Thanks for that heads up, we just received our MCB package yesterday and I was glad I had read your post. If I read my package correctly, you do have to comply or you will be classified as a recalcitrant holder which in my letter states will have consequences like you said (30%). Thanks again, otherwise, i would be sitting here scratching my head and wondering what this is all about. The information I received was very explanatory and came with a booklet "General Information on "FATCA".

DiverVince
04-27-2014, 01:48 PM
We got ours this week. IMHO, total BS what the US government is doing.

MikeTruesdell
04-28-2014, 10:20 AM
We go yours Friday. No explanation just forms needed. The only thing I think they previously did not have were pay tickets as they call them. Bruce, were these forms sent to all accounts?

Bruce Z
04-28-2014, 10:33 AM
We go yours Friday. No explanation just forms needed. The only thing I think they previously did not have were pay tickets as they call them. Bruce, were these forms sent to all accounts?

MCB and the other Bonaire banks should be searching their account holder database to determine which accounts are owned or controlled by US Persons, so yes, that is what should be happening, but not to non-US owners.

antennariidae
04-28-2014, 03:22 PM
Heard this a few months ago. Wow. Only two sure things: death and . . .

http://www.npr.org/blogs/parallels/2014/02/20/275937138/why-more-americans-are-renouncing-u-s-citizenship

Bruce Z
04-28-2014, 06:05 PM
Fortunately for us on Bonaire MCB and Banco de Caribe need the American depositors and want their business, so they are complying with FATCA instead of closing the door to American account holders. I haven't checked but assume ORCO, GIRO and RCB are also doing the same. I think for almost everyone here the requirement to fill in a couple pages of documents and a W-9 is not such a big deal. The only people who won't are ones who do not want to comply with US law, and I think it will be tough (and unsafe) to live on Bonaire without a local bank account. Worldwide the banks that are closing American accounts are losing substantial business to the ones willing to do the paperwork, and I think they will come back looking for easy capital.