CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Democrats Abroad Warn On FATCA Effect For American Expats

Democrats Abroad Warn On FATCA Effect For American Expats

by Mike Godfrey,, Washington

18 September 2014

Democrats Abroad (DA), the overseas arm of the Democratic Party, has issued the results of its 2014 global survey, which demonstrates the growing concerns about taxation and financial reporting facing Americans living outside the United States, and in particular the consequences of the Foreign Account Tax Compliance Act (FATCA).

FATCA was enacted in 2010 to target non-compliance by US taxpayers using foreign accounts. It requires US financial institutions (FIs) to withhold 30 percent of certain payments made to foreign FIs that do not agree to identify and report information on US account holders.

DA confirmed that it has been working to alleviate the unintended consequences of FATCA. While noting that the Act "was enacted to stop Americans living in the US from hiding money from the taxman in overseas accounts, it has meant that one in six citizens who responded to the survey have had their financial accounts closed because their foreign FIs did not want to incur the cost of annual reporting on American customers' accounts to the US Internal Revenue Service."

In addition, the survey results are said to "show the intense impact FATCA is having on overseas Americans. Their financial accounts are being closed, their relationships with their non-American spouses are under strain (21 percent reporting that they either no longer have joint accounts or are thinking of moving to separate accounts), some Americans are being denied promotion or partnership in business because of FATCA reporting requirements, and some are planning or contemplating renouncing their US citizenship."

The latest survey was carried out in June and July 2014 to examine experiences related to FATCA. There were 6,552 responses from Americans hailing from all 50 states and the District of Columbia, who are now living outside the US in locations across six continents.

Carmelan Polce (Democrats Abroad in Singapore), Chair of DA's FATCA Task Force, said: "We are so pleased with the enormous response to our survey from Americans living abroad. The remarks they have provided suggest Americans, no matter where they live, support policies that fight tax evasion. They want this policy to work and have participated in the study in order to express the problems they face."

In its meetings in Washington, DA stressed that it has always insisted that "most Americans living abroad are ordinary citizens living middle class lives after moving abroad for employment, a relationship or retirement, and are not the intended target of the FATCA legislation."

"We believe that the unintended consequences of FATCA raised by this survey – an unfair burden for Americans abroad – can be relieved without undermining the enforcement power of the law," added Kathryn Solon (Democrats Abroad in Germany), DA's International Chair.

TAGS: individuals | expatriates | compliance | Citizenship | Foreign Account Tax Compliance Act (FATCA) | tax | tax compliance | FATCA | law | banking | enforcement | legislation | United States | Compliance | Expats | Tax

To see today's news, click here.



Password Reminder

Please enter your email address to receive a password reminder.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Tax-News+ Updates

Receive FREE daily updates from, straight to your inbox. Register Now!

For a tailored solution, choose to receive selected news updates for your preferred jurisdictions and topics, with our enhanced Tax-News+ subscriber service. Read more...


Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »