NYC Bar Panel Asks IRS to Clarify FATCA Rules for Trusts, PFICs

The New York City Bar Committee on Estate and Gift Taxation asks the government to clarify the reporting rules for trusts and passive foreign investment companies under the Foreign Account Tax Compliance Act. The development comes as taxpayers try to determine how to apply the new law's requirement that they report their interest in foreign financial assets, as well as the new rule that PFIC shareholders report information about their holdings to IRS each year. The provisions were put in place in March 2010 as part of FATCA, which requires foreign financial institutions to disclose U.S.-owned accounts to IRS or face, in some cases, a 30 percent withholding tax.

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