The enactment of the Foreign Account Tax Compliance Act (FATCA), following the UBS scandal
, was designed to inhibit tax evasion through the use of off shore accounts. However, the Act has the residual burden of complicating tax return filing for US citizens living abroad. The new form, Form 8938, the Statement of specified Foreign Financial Assets requires that taxpayers list, in detail, their overseas accounts. Failing to file carries a minimum penalty of $10,000 and the statute of limitation does not lapse until a corrected form is filed.
See David Jolly, "For Americans Abroad, Taxes Just Got More Complicated
", The New York Times (April 15, 2012)
Posted by Myriam Clerge
, Associate Editor, Wealth Strategies Journal