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Posts: 74

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Q: Help! Can anyone explain FATCA? And is my money safe in China?

If you're not American, this doesn't apply to you, however your country probably has something similar. 

 

I don't anything about FATCA, but US expats on other forums are saying that basically it requires foreign banks to report the details of your finances to the US government. 

 

Implications include:

- if you have more than $10,000, they can take half of your money per year

- Some banks may not open accounts for Americans, because its not worth the hassle 

 

7 years 50 weeks ago in  General  - China

 
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Posts: 155

Governor

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Should I be paying taxes? Seriously, I have no idea how this works. 

Lord_hanson:

From what I have been told by American friends they do have to pay taxes still.

7 years 50 weeks ago
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7 years 50 weeks ago
 
Posts: 19790

Emperor

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Non-American with ability to use Yahoo-gle search and explanation of FATCAt:

https://www.irs.gov/Businesses/Corporations/Foreign-Account-Tax-Complian...

Foreign Account Tax Compliance Act
FATCA Current Alerts and Other News

The provisions commonly known as the Foreign Account Tax Compliance Act (FATCA) became law in March 2010.
FATCA targets tax non-compliance by U.S. taxpayers with foreign accounts
FATCA focuses on reporting:

By U.S. taxpayers about certain foreign financial accounts and offshore assets

By foreign financial institutions about financial accounts held by U.S. taxpayers or foreign entities in which U.S. taxpayers hold a substantial ownership interest
The objective of FATCA is the reporting of foreign financial assets; withholding is the cost of not reporting.

FATCA Information for Individuals
FATCA Current Alerts and Other News

U.S. citizens, U.S. individual residents, and a very limited number of nonresident individuals who own certain foreign financial accounts or other offshore assets (specified foreign financial assets) must report those assets
Use Form 8938 to report these assets

Attach Form 8938 to the annual income tax return (usually Form 1040)
Taxpayers with a total value of specified foreign financial assets below a certain threshold do not have to file Form 8938

If the total value is at or below $50,000 at the end of the tax year, there is no reporting requirement for the year, unless the total value was more than $75,000 at any time during the tax year

The threshold is higher for individuals who live outside the United States

Thresholds are different for married and single taxpayers
Taxpayers who do not have to file an income tax return for the tax year do not have to file Form 8938, regardless of the value of their specified foreign financial assets.
Penalties apply for failure to file accurately
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. Information on filing a delinquent Form 114 can be found at Delinquent FBAR Submission Procedures. See the Comparison of filing requirements for further information.
Third-party reporting: Foreign financial institutions may provide to the IRS third-party information reporting about financial accounts, including the identity and certain financial information associated with the account, which they maintain offshore on behalf of U.S. individual account holders.
Application to domestic entities: The IRS anticipates issuing regulations that will require a domestic entity to file Form 8938 if the entity is formed or used to hold specified foreign financial assets and the total asset value exceeds the appropriate reporting threshold. Until the IRS issues such regulations, only individuals must file Form 8938. For more information about domestic entity filing, see Notice 2013-10.

Page Last Reviewed or Updated: 07-Apr-2016

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https://www.irs.gov/Businesses/Corporations/Foreign-Account-Tax-Complian...

 

Like - Click this link to Add this page to your bookmarks  Print - Click this link to Print this pageForeign Account Tax Compliance Act

FATCA Current Alerts and Other News

 

The provisions commonly known as the Foreign Account Tax Compliance Act (FATCA) became law in March 2010.

  • FATCA targets tax non-compliance by U.S. taxpayers with foreign accounts
  • FATCA focuses on reporting:

 

  • By U.S. taxpayers about certain foreign financial accounts and offshore assets

 

  • By foreign financial institutions about financial accounts held by U.S. taxpayers or foreign entities in which U.S. taxpayers hold a substantial ownership interest
  • The objective of FATCA is the reporting of foreign financial assets; withholding is the cost of not reporting.

 

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7 years 50 weeks ago
 
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 I forgot 2nd part of the Q :

 

http://www.businessinsider.com/bank-of-tianjin-missing-bank-notes-2016-4

 

Another huge bank heist in China is a warning that we're about to see its stock market get wild again

 

The last thing Chinese authorities need is for this to become a thing.

 

Last week, over $120 million in bank notes went missing from the Bank of Tianjin, a Chinese bank that was just listed on Hong Kong's stock exchange a few trading days before.

The bank put out a statement acknowledging the robbery as a "risk incident," and that authorities were investigating the situation.

This is the third time within the last year that thieves have made off with a ton of a specific kind of bank note, known as a "bill of exchange." The biggest of all these scandals was reported in January, when authorities disclosed that thieves stole almost $600 million worth of these bills of exchange and used a bunch of the cash to buy stocks before the Chinese stock market crashed last summer.

A few days after that, around $150 million worth of these notes went missing from China CITIC Bank.

Bills of exchange are short-term promissory notes that banks hold for clients, and in most of these cases the suspects in question were bank employees.

Now, this tells a couple of things about how crazy China's banking system still is, and what's coming for the Chinese stock market:

  • First, know that demand for bills of exchange has skyrocketed in the country over the last year, as long-term loan demand is drying up. According to Caixin, the total value of these bills has increased by almost 60% since 2014. Note: That's when the Chinese stock market really ramped up, too.

  • These bills can be turned into cash through these third-party bills agencies, and because of their explosive growth, Chinese authorities haven't really caught up with this regulation-wise. The notes from Tianjin were exchanged for cash through a third party in Zhejiang Province. This is still kind of a Wild West situation.
  • Bills of exchange were often used to invest in the Chinese stock market before it crashed last summer. The fact that this heist just happened now, at a time when regulators are encouraging the Chinese stock market to get back on its feet, is pretty interesting in and of itself. The casino is open, and it looks like people are doing whatever they can to put money in again. If that's the case, we may be in for another wild ride up and then — of course — down.

Here's the Bank of Tianjin's statement about the incident:

bank of tianjinTwitter, @io8_8ov

 

 

For more on China's stock market and the craziness that's about to go down, listen to Business Insider's Josh Barro and Linette Lopez talk about it on their podcast, Hard Pass:

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