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Tax Dispute Resolution - Update on FATCA and Foreign Finance Companies 

Global Tax Adviser

 

May 29, 2012

 

The latest issue of Tax Dispute Resolution Quarterly, KPMG's interactive client newsletter, contains several articles of interest, including the IRS probe into foreign finance companies and the proposed Foreign Account Tax Compliance Act (FATCA) regulations. This publication is prepared by KPMG U.S.

Multinationals affected by IRS audits of foreign finance companies
The Internal Revenue Service (IRS) has been conducting audits of transactions entered into by foreign group finance companies of U.S. multinationals. In preparation for potential IRS audits, U.S. multinationals with foreign group finance companies should carefully review existing hedging policies and procedures.

 

FATCA regulations
"News brief: Proposed FATCA regulations " discusses the proposed regulations on the FATCA, intended to help combat offshore tax evasion by U.S. persons. Specifically, FATCA imposes a 30% punitive withholding tax on "withholdable payments" made to non-compliant foreign financial institutions and certain other foreign entities. The article notes that a public hearing for the proposed regulations was scheduled for May 15, 2012 and that the final regulations are expected to be released this summer .

 

Tax Dispute Resolution Quarterly [PDF 453Kb],  dated April 2012, is available online. For more information, contact your KPMG adviser.

KPMG Publications

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