Daily Tax Update - November 15, 2012: Treasury Publishes Second Model FATCA Intergovernmental Agreement

TREASURY PUBLISHES SECOND MODEL FATCA INTERGOVERNMENTAL AGREEMENT: Today, Treasury published a second model "Intergovernmental Agreement for Cooperation to Facilitate the Implementation of FATCA."  Earlier this year, Treasury released one version of a model intergovernmental agreement under which foreign financial institutions would report their US account holders to their local tax authorities, who would exchange such information with the United States.  The version released today provides for direct reporting by foreign financial institutions to the IRS.  This reporting would be supplemented, upon request of the US competent authority, by the exchange of information on US accounts that are identified as accounts of recalcitrant account holders.  Further analysis of the second model intergovernmental agreement will appear in a subsequent Daily Tax Update.

The document can be accessed here:  Model 2 Agreement to Implement FATCA

For additional information, contact Philip R. West - pwest@steptoe.com or Amanda Varma - avarma@steptoe.com

IRS ADVISORY COUNCIL ISSUES ANNUAL REPORT:  The IRS Advisory Council (IRSAC) issued its 2012 annual report, which covers a range of key issues affecting taxpayers. IRS Commissioner Steven T. Miller said, “IRSAC members provide valuable feedback on products, programs and services of the IRS. We welcome their perspectives as we address future challenges."

  • The report made recommendations on the following issues:
  • Streamlining the Audit Process
  • Managing Knowledge in the Issue Practice Groups and International Practice Networks
  • Improving Lien Withdrawal Processing
  • Enhancing the availability of electronic completion and filing for Form 1099-Miscellaneous
  • Increasing BMF Electronic Filing
  • Enhancing the reporting of dispositions of capital assets on various forms
  • Tax Practitioner obligations and competency

INTERNAL REVENUE SERVICE - CIRCULAR 230 DISCLOSURE: 
As provided for in Treasury regulations, advice (if any) relating to federal taxes that is contained in this communication (including attachments) is not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any plan or arrangement addressed herein.

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