Panama Forum

4sarge
Joined 2014
Posts: 110

10 years ago

More on FATCA

10 years ago

I just wanted to highlight the part that says “. If you have money exceeding $10,000 for even one day in one or more foreign financial accounts aggregate,”

If you have only one Panamanian bank account, and if you deposit a check for $10,000.02 into that account, and if the money is in that account for even thirty seconds – then you have to report that bank account information to the IRS under this new law.

If you have three bank accounts, and if at any point during the year the SUM TOTAL of all deposits in all of those accounts goes over $10,000 – even by a cent or even for one second – now you have to report all three of those accounts to the IRS. That’s the threshold or reporting trigger mechanism.

This law is why the Panamanian banks are trying to discourage Americans from opening accounts. The US is pressuring the Panamanian banks to report this same data. They don’t want to, but they are going to have to. If they fail to comply then the US has the ability to shut down their clearing house accounts in the US until they do. They will be complying.

And what’s more the penalties for not complying are draconian. If the IRS determines that you “willfully” failed to comply, the penalty is 50% of what’s contained in all accounts, per year. So if you go two years with $1 million dollars in your Panamanian bank accounts and “willfully” fail to comply – then the IRS can come in and take all of your money. Seriously, 100% - or 50% times two, for the two years of willful noncompliance. And as far as the IRS is concerned, if you have a lot of money stashed overseas, then you knew. They will seize your assets, and leave it up to you to fight it out in court. They have unlimited (government) assets, and oh by the way they also have all of your assets as well. Meanwhile, you don’t have two dimes to rub together to hire an attorney. And for the record “willfully” means that you actually knew you had to report but decided not to. So then they seize your computer. And they read this email on your computer. And … you’re screwed. Well, actually they will just ask the NSA if you’ve ever seen anything like this on the Internet ever and you’re still screwed.

One more thing. Don’t discuss these issues with your accountant. There is no such thing as “accountant – client privilege”. The IRS can haul your accountant in for questioning, read him his rights, and interrogate him if they suspect you are breaking the new law. And he will roll over on you like a bitch, instantly, in order to protect his license. His ability to feed his family will trump whatever loyalty you think you might have with the guy. So what you want to do is hire a lawyer, and then have the lawyer hire the accountant, who does the accounting work for you, on the lawyers behalf. This puts the “attorney – client privilege” between you and the accountant. Got it, Mr. Capone?

Final best defense – be broke like me. The IRS never comes after broke guys, unless they really want to punish you for something. They can huff and puff, but it’s really all about the money. If you don’t have any money or assets to take away, then you don’t have much to worry about. If you’re rolling in money, then you damn well better know what you’re doing.

See:

http://thehill.com/blogs/congress-blog/foreign-policy/313775-fatca-simple-premise-gone-terribly-wrong

http://www.forbes.com/sites/beltway/2011/06/20/why-obamas-fatca-law-is-a-threat-to-business-growth/

http://www.reuters.com/article/2014/01/31/us-usa-tax-fatca-idUSBREA0U1XK20140131

https://www.uschamber.com/blog/next-obamacare-fatca-roll-out-flounders

http://www.dailypaul.com/312861/obama-s-new-july-1st-2014-law-will-shock-most-americans

Don Winner

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