More Info On The Fatca Confidentiality Requirements

[Mike S]

I just got this from a bank manager in regards to signing your confidentiality rights away ...... I already know what I'm going to do ... I don't want the IRS or BIR looking at my financial records and as there is no such thing as privacy anymore I am simply going to close all our joint accounts and have my asawa open new ones in her name .... I already talked to the bank  today when we went in to do our monthly transactions .... course if she dies before me I might have to give a % to the Phil government in the form of inheritance tax but we won't have that much in the accounts as we pay cash for everything ...... anyway guess I'll worry about that when the time comes as she is 20 years younger than me ..... :hystery: :hystery: ..... besides we have some put away plus some in US accounts so I should be fine .... if i loose her ...... paying the Phil government will be the least of my worries ..... :tiphat:

:cheersty:

 

 

Regarding FATCA, banks are not required to report yet until March 31, 2015. However, in the coming days, we might
be sending out informations and necessary forms to ease the transition.

 

Reportable amount is $50,000.00 or its peso equivalent. If the balance in the accounts is kept below said amount then the bank will not be reporting it.

 

Most likely, banks all over the country will be sending forms to American nationals to waive the confidentiality of their accounts

but as of now, Bank of Commerce has not sent out any forms yet.

 

I will keep you posted.

 

 

 

Here is a copy of a post from another board in regards to the role the Philippines is playing and how they are going to handle this transaction .....

 

 

They will all comply.....mark my words. They will either sign up directly with the IRS or their respective governments will take the option of whats called an IGA. (inter-govermental agreement) where  the banks will report the info to their own governments who will in turn forward the info to the US.

 

The Philippines has opted to go the IGA route. The Banks in the Philippines will report your account to the BIR who will forward the into to the IRS after having a look at it themselves of course.

Edited April 28, 2014 by Mike S

[OnMyWay]

The banks here may give out bad information regarding parts of the law, as they may not understand it.  I suggest that each expat read the actual IRS information.  That being said, the bank will make you comply to what they think are the rules.  The following link is for individuals.  If you own a business, there is another section.

 

http://www.irs.gov/Businesses/Corporations/FATCA-Information-for-Individuals

 

Quote from that link:

 

Alert: The reporting requirement for Form 8938 is separate from the reporting requirement for the FinCEN Form 114, Report of Foreign Bank and Financial Accounts (“FBAR”) (formerly TD F 90-22.1). An individual may have to file both forms and separate penalties may apply for failure to file each form.  See the Comparison of filing requirements for further information.

 

End quote

 

It is important to note the thresholds for the two different sections of the law, FBAR and Form 8938, are different and are applied differently.  This chart lays it out well:

 

http://www.irs.gov/Businesses/Comparison-of-Form-8938-and-FBAR-Requirements

 

The FBAR extension to June 30th, 2015 is only for a few types of people who have signatory over a business entity account.  Apparently there are some gray areas to the law that still have not been repaired, thus multiple extensions FOR THOSE PEOPLE.  Everyone else who qualifies must file every year.  I used to file when I lived in Germany but it was not called FBAR then.  This $10,000 reporting is nothing new for the individual taxpayer, but FATCA is putting teeth into it.  It used to be "on your honor" but now they will have data to find out the actual account balances and nail you if you did not file.

 

Don't trust me on this.  Do your own due diligence and consult with a tax professional if needed.  There is actually a section of the 2013 1040 form about the need to file FBAR and I had to check it "Yes, I will file" for 2013.

[Mike S]

The banks here may give out bad information regarding parts of the law, as they may not understand it

 

The information I gave above is for the NEW ruling and joint cooperation between the Philippine banks and the IRS where they will be required to report to the IRS any and all US bank accounts held in the US foreigners name here in the Philippines and the form they will give you to sign which in fact gives away your rights to privacy under Philippine banking laws ....

 

The old rules and regs are still in effect for YOU to report to the IRS ..... as has been the case for years ........ the new reg not only makes YOU report but also the Philippine as well as world wide banks also report directly to the IRS .... if you elect not to sign the banks form your account will be closed .....

 

I think we are talking apple and oranges here ..... they are two different regulations ..... one on how Philippine banks will be dealing with the IRS and the second on how you will continue to deal with the IRS .... one YOU have to report .... the other (if you sign the agreement) will be reported for you .... if you don't sign your Philippine bank account will be closed .....

:cheersty:

[MikeB]

The important thing to know is that without your signed consent the Philippine bank cannot, by law, divulge any information about your account to anyone. It's an old law that got even tighter under Marcos. By signing the consent you are giving up this right. 

[OnMyWay]

The information I gave above is for the NEW ruling and joint cooperation between the Philippine banks and the IRS where they will be required to report to the IRS any and all US bank accounts held in the US foreigners name here in the Philippines and the form they will give you to sign which in fact gives away your rights to privacy under Philippine banking laws ....

 

Thanks Mike.  What threw me off of that angle was the mention of the $50,000, as the U.S. law has the two thresholds of $10,000 and $50,000.

 

I'm curious to see if the IRS is agreeing to different reporting thresholds for different countries.  E.g., if PH has to only report back on assets > 50,000, do some countries report on >10,000?  That would make a huge difference in the amount of accounts reported.

 

I read an article a while back that some software companies were in the Philippines touting their software to banks, for direct reporting to the IRS.  I hope they go this route as I really don't want the PH government getting the data too.

[Dave Hounddriver]

The important thing to know is that without your signed consent the Philippine bank cannot, by law, divulge any information about your account to anyone.

 

And yet . .  they do.  Tell me your bank manager's name and I will go in and ask your balance stating it is allowed under the 'Old Pal's Act'  and I'll put up odds that I can get your info.  Few filipinos understand the concept of secrecy/privacy.  Disclaimer:  Such is my personal experience and your mileage may vary.

[OnMyWay]

 

The important thing to know is that without your signed consent the Philippine bank cannot, by law, divulge any information about your account to anyone.

 

And yet . .  they do.  Tell me your bank manager's name and I will go in and ask your balance stating it is allowed under the 'Old Pal's Act'  and I'll put up odds that I can get your info.  Few filipinos understand the concept of secrecy/privacy.  Disclaimer:  Such is my personal experience and your mileage may vary.

 

 

And as mentioned in an old thread, when they shout your personal information across a crowded room full of customers, the privacy is all lost!   :bash:  :hystery:

 

Luckily my BPI branch seems fairly good at not pulling knucklehead stunts like that, but I can imagine that all bank employees talk among themselves about customer accounts, especially rich customers.

[Mike S]

Thanks Mike. What threw me off of that angle was the mention of the $50,000, as the U.S. law has the two thresholds of $10,000 and $50,000

 

Yes I was a bit surprised about that also .... I guess they don't want to have to be bothered adding up all your totals each month to see if you went over the $10,000 mark for the year ..... I also need to point out that this information came from Bank of Commence .... not sure about other banks ....... my personal take on this is the IRS probably told them that the only reason for their request was to catch money laundering .... and those people possibly funding the terrorists in the Philippines for which the Phils would jump all over that ......

 

Makes one wonder just how far the US would go if the Philippines asked them to do the same to all the Filipinos living in the US .... I would be very much surprised if they would ....

 

As I said before and I will say it again I have nothing to hide to my knowledge ...... I am just sick and tired of having rights taken away from me as a US citizen by my own country all in the name of freedom ..... horse sh*t ..... there is no such thing as freedom in the US any more .... JMHO

:cheersty:

[MikeB]

A couple of posts seem to suggest that the bank secrecy law is widely ignored because they've heard a bank employee blabbing about a customer's balance or personal info (which should NEVER happen). I don't buy it, I think there's a big difference between that and what's required by law to be reported from one foreign govt agency to another. 

[OnMyWay]

A couple of posts seem to suggest that the bank secrecy law is widely ignored because they've heard a bank employee blabbing about a customer's balance or personal info (which should NEVER happen). I don't buy it, I think there's a big difference between that and what's required by law to be reported from one foreign govt agency to another. 

 

Two different types of secrecy, both important to an expat.