FATCA for Americans Living In Mexico and Required US Reporting Seminar on 6/21 in Los Cabos

Please be certain to confirm your reservation if you wish to attend.       F.A.T.C.A FOR DUMMIES EVENT When Friday June 21st, 2013 From 5:00 PM to 9:00 PM Add to Calendar    Where Hotel Playa Grande Avenida. Playa Grande1 Plaza Nautica. Cabo San Lucas 23450 Baja California Mexico    Dear Friend, Intercam-Interbanco is pleased to invite you to our conference & cocktail on Tax Reporting for USA Tax Payers living abroad and the Foreign Account Tax Compliance Act (FATCA). Each topic will be addressed under the Financial and Legal perspectives by two experts on the field, respectively.    Speakers: Ing. Eduardo Garcia Lecuona    Don D. Nelson Attorney at Law, CPA.      We look forward to see you on Friday, June 21st at the Playa Grande Hotel, in Cabo San Lucas. Conference: 5:00pm. Cocktails and hors d'oeuvres will be served affter the conference.    "Don't forget to register and prepare your questions"       More Information       Sincerely,         Follow Us

US Bank Interest Earned by Mexican Citizens Will Be Reported to Mexico

The new IRS rules could result in massive losses to banks along the US-Mexico border. The regulation requires US banks to report details of interest paid to Mexican Citizens (who are not US taxpayers) holding personal accounts even though such interest is not subject to US income taxes. According to an IRS statement, this is aimed at helping their countries of residence fight tax evasion.  US banks along the border feel that some Mexican clients will transfer their accounts elsewhere to avoid the Mexican tax agency from learning of about their funds.

Many banks in the US-Mexico border rely  on deposits and investments from nonresident Mexican citizens to provide the funds  to grant loans to local communities. Some border banks have up to 45% of their accounts held by Mexicans who deposit their money in the US for security reasons. 

Under the new regulation, the information from the banks is reported to the Treasury then the IRS can provide that information to the Mexican Hacienda under the US/Mexican tax treaty.

The rules became effective on April 19, 2012. Mexican Citizens who have secreted funds in US banks need to consider whether those funds should be left there and pay Mexican income taxes on the interest earned by those funds on their Mexican tax returns.

Complete Form 8938 and TDF 90-22.1 Guidance In Simple Chart Form

The IRS has just published further information on when to file forms 8938 (to report foreign financial assets) and TDF 90-22.1 (FBAR) to report foreign financial accounts. Their guidance clarifies when foreign currency and precious metals located in foreign countries must be reported. The Chart is easy to understand and can be read HERE.

If the value of  the assets in your Fideicomiso, Mexican bank accounts and Mexican corportion exceed the thresholds set forth in this table, they must be reported on this form as well as on Forms 5471, 3520, 3520A, etc.

If you wish assistance in preparing these forms or wish to have your own self prepared forms reviewed by an expert contact us.