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Treasury and IRS Issue Guidance Outlining Phased Implementation of FATCA Beginning in 2013

Remove IRS Tax Lien Levy



Press Release

IR-2011-76, July 14, 2011

WASHINGTON — The Treasury Department and the Internal Revenue Service recently issued a notice announcing plans to phase in the requirements of the Foreign Account Tax Compliance Act (FATCA). The new law targets noncompliance by U.S. taxpayers through foreign accounts.

Under the notice’s phased implementation approach, foreign financial institutions (FFIs) and U.S. withholding agents are given adequate time to build the systems needed to fully comply with FATCA.

"FATCA is an important development in U.S. efforts to combat offshore noncompliance.  At the same time, the IRS recognizes that implementing FATCA is a major undertaking for financial institutions." said IRS Commissioner Doug Shulman.  "Today's notice is a reflection of our serious commitment to implementation of the statute, but also a serious commitment to listen to the implementation challenges of affected financial institutions and make appropriate adjustments to ensure a smooth and timely roll-out."

FATCA was enacted in 2010 as part of the Hiring Incentives to Restore Employment (HIRE) Act.  FATCA requires FFIs to report to the IRS information about financial accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest.  In order to avoid being withheld upon under FATCA, a participating FFI will have to enter into an agreement with the IRS to:

  • Identify U.S. accounts,
  • Report certain information to the IRS regarding U.S. accounts, and
  • Withhold a 30-percent tax on certain payments to non-participating FFIs and account holders who are unwilling to provide the required information.

FFIs that do not enter into an agreement with the IRS will be subject to withholding on certain types of payments, including U.S. source interest and dividends, gross proceeds from the disposition of U.S. securities, and passthru payments.

Notice 2011-53, issued July 14,2011 by Treasury and the IRS, provides a workable timeline for FFIs and U.S. withholding agents to implement the various requirements of FATCA.  Specifically, the notice phases in the implementation of FATCA in the following manner:

  • An FFI must enter an agreement with the IRS by June 30, 2013, to ensure that it will be identified as a participating FFI in sufficient time to allow withholding agents to refrain from withholding beginning on January 1, 2014.
  • Withholding on U.S. source dividends and interest paid to non-participating FFIs will begin on Jan. 1, 2014, and withholding on all withholdable payments (including on gross proceeds) will be fully phased in on Jan. 1, 2015.
  • Due diligence requirements for identifying new and pre-existing U.S. accounts (including certain high-risk accounts) will begin in 2013.  Reporting requirements will begin in 2014.
  • For purposes of the Notice, high risk accounts include private banking accounts with a balance that is equal to or greater than $500,000.

Treasury and IRS will continue to work closely with businesses and foreign governments to implement FATCA effectively.

 


Shamsey Oloko: Picture Perfect Ambition

Shamsey
Shamsey Oloko, a partner at the Thorgood Law Firm, is a seasoned US Tax Code veteran.  He has been in the trenches for over twenty years representing businesses and individuals in tax controversy proceedings and performing audit activities, as well as in criminal tax prosecutions.  Many of Shamsey’s clients are either tax preparers who often inadvertently direct their clients to run afoul of the Code or who file tax returns based on interpretations of the Code that are either unpopular or simply raise the ire of the IRS.  Shamsey has often found himself working with businesses that have been established in a state other than NY, but unbeknownst to the client touches New York for tax purposes.

 

Shamsey, originally from Nigeria, started his career in tax long before he entered law school.  As a student in St. John’s University’s MBA in Finance program, Shamsey took a quick liking to tax after his professor declared: “the only two things in life that are definite are death and taxes”.  Coming from a country where taxes were elective, Shamsey was not immediately convinced.  However, he quickly realized that if this statement were true there would always be work to do in both of these areas.  Having no interest in working with the dead, Shamsey elected to build his career in the more exciting and sexy tax industry.

 

What is the most interesting part of our job?

I really enjoy dealing with individuals who feel so overwhelmed by the IRS and the tax rules.  It gives me great pleasure to be able to assist them in managing this relationship, empower them and provide solutions for their problems.

 

Where do you see yourself professionally in ten years?

Exactly what I am doing now.   Although I have the flexibility to work for a large firm or corporation, I’ve always known that I wanted to be self–employed.  I also really enjoy the dynamic nature of tax.  It’s such an integral part of everyday life.  I always feel challenged in my practice and regularly seek out new opportunities to grow. 

 

When you are not strategizing about your future as a tax professional or waist deep in client files, what do you do with your free time?

Reading.  I love to explore the world through literature.  I am also a photographer in hiding.  I carry my Canon T2i whenever I am on an adventure away from work.  I like to capture each moment of life with my camera.  Those moments can never be replicated, but they can be memorialized for the future.

Shamsey_photo_GCT
Shamsey_photo_GCT

 

Who is your role model?  Why?

Bill Clinton is my role model.  To appreciate Bill, you have to know his past.  He does not allow people to limit what he can achieve.  Bill and Hilary were, and still are, a great team.  They were both ahead of their time in many respects.

 

In three words or less, describe yourself?

Outgoing.  Driven.  Compassionate.

 

Contact Shamsey

If you want to learn more about Shamsey and his practice, feel free to contact him directly.  He would love to hear from you. 

Shamsey T. Oloko, Esq.
The Thorgood Law Firm
100 Park Avenue - 20th Floor

New York, N.Y. 10017

Tel: (212) 490-0704
Cell: (347) 661-4575
Fax: (212) 490-0706

Email: oloko@thorgoodlaw.com
Web: www.thorgoodlaw.com

© Copyright

Written by Marsha Henry


Tanza Olyfveldt: Professional and Driven

Tanza Olyfveldt-1 Tanza Olyfveldt began pursuing a legal career as a tax practitioner after graduating from the University of Ottawa with a law degree in 2007.  After articling at a tax boutique law firm and seeking a challenge, she decided to expand her knowledge of the rules governing international tax issues by  continuing her legal studies at Northwestern University School of Law.  In Spring 2010, she completed a LL.M. in taxation.  

 

Since then, Tanza has been working at PricewaterhouseCoopers LLP as an International Tax Consultant specializing in US/Canada cross-border tax issues related to transactions involving multinational corporations.

 

Tanza provides advice to a wide range of clients in various industries.  However, she has been developing a niche practice delivering consulting services to financial services companies.

 

What is the most interesting part of your job?

Dealing with files that really engage the US Tax Code and/or the Canadian Income Tax Act and related tax treaties.   In particular, working with tax treaties to resolve complex tax issues involving multiple jurisdictions.  For example, I get really excited when I’m on a file with complicated tax issues that span the U.S., Canada and other countries – that sort of complexity often happens when we advise multinational clients on restructuring in merger and acquisition transactions.  Since a lot of the files I see involve the financial services industry, I’m also learning a lot about various financial products, particularly in asset management.  Basically, I am generally most interested in things that challenge me to think outside of the norm.

 

If you could have dinner with one person who is no longer living, who would it be and why?

I would really enjoy having dinner with Michael Jackson because he was a compassionate person who was very dedicated to his work.  I would love to gain insight into what motivated him to achieve and maintain the level of success he reached before his death.  I’d also like to chat with him about how he viewed the world.

 

Describe yourself in three words or less

Confident, ambitious, compassionate.

 

Where do you see yourself five years from now?

In five years, I see myself more intimately involved in the client’s business as a strategic leader.

 

In your spare time, what do you watch on T.V.?

I’m a huge fan of the Colbert Report, the Daily Show with Jon Stewart and Criminal Minds.  

 

Written by Marsha Henry