As the January 1, 2014, implementation date for the Foreign Account Tax Compliance Act (FATCA) rapidly approaches, the U.S. government is continuing to make progress in negotiating Intergovernmental Agreements with partner jurisdictions in order to facilitate the effective and efficient implementation of FATCA.
On November 14, 2013, Treasury announced that the U.S. has signed an IGA with France. With this announcement, a total of 10 IGAs have been signed to date. The press release is available here and the signed IGA is available here.
FATCA seeks to obtain information on accounts held by U.S. taxpayers in other countries. It requires U.S. financial institutions to withhold a portion of payments made to foreign financial institutions (FFIs) who do not agree to identify and report information on U.S. account holders. FFIs have the option of entering into agreements directly with the IRS, or through one of two alternative Model IGAs signed by their home country. The IGA between the United States and France is the Model 1A version, meaning that FFIs in France will be required to report tax information about U.S. account holders directly to the French government, which will in turn relay that information to the IRS. The IRS will reciprocate with similar information about French account holders.
The following list identifies the countries which have signed IGAs with the U.S. government to date, including the date of the agreement and the type (Model 1 vs. Model 2):
Model 1 IGA
Model 2 IGA
Treasury’s press release further stated that in addition to these 10 IGAs, the U.S. has also reached 16 agreements “in substance” and is actively engaged in negotiations “with many more jurisdictions.”