Tuesday, September 20, 2011
Fort Walton Beach - Annual Fun Day
The FWB office enjoyed their annual Fun Day on Friday. The afternoon began with lunch at Moe's, followed by bumper boats, putt putt golf, race cars and bumper cars at The Track and ended with ice cream at Marble Slab. The coveted Fun Day trophy passed from Teri Elkins to Nicole Fife to proudly display for the next year. Thank you to Glenn for another great Fun Day!
Thursday, September 15, 2011
Plan Sponsors Affected by Hurricane Irene Granted Additional Time to File Form 5500 and, in Certain Cases, to Fund Their Plans
As part of Internal Revenue Service (IRS) tax relief related to individual and business taxpayers impacted by Hurricane Irene, where retirement plan sponsors – or the plan sponsor’s records necessary to complete the return – are located in the federally designated disaster areas listed in IR 2011‐87 (originally published September 1, 2011 and subsequently updated to reflect new areas for relief), the sponsors will have until October 31, 2011 to file annual Form 5500 for their retirement and welfare benefit plans. This extension applies to Forms 5500 that had a due date for filing after August 26, 2011 and before October 31, 2011.
Plan Sponsors Qualifying for Relief
The U.S. Department of Labor (DOL) website discusses Disaster Relief Information as follows: “Filers affected by Presidentially-declared disasters are plan administrators, employers, and other entities who file Form 5500 series that are located in the areas designated as federal disaster areas (as listed in IRS’s announcements). These special extensions also apply to filers located outside the designated disaster areas who are unable to obtain the information necessary for filing from service providers, banks or insurance companies whose operations are directly affected by the disasters.”
Impact on Plan Funding and Deductions
Because the tax relief granted by IRS includes an extension of time to file business and individual tax returns, plan sponsors will be able to take a tax deduction for contributions made to their plans for the prior period if the contributions are deposited by the new extended due date of the return and provided they have met the other requirements of Internal Revenue Code (IRC) Section 404(a).
However, sponsors of plans that are subject to the minimum funding provisions of IRC Section 412 – such as defined benefit plans, cash balance plans, and money purchase pension plans – are still required to fund these plans within 8½ months after the plan’s year end, as IRS has not granted additional time to meet the minimum funding requirements under IRC section 412. For calendar year plans, this means that contributions will still need to be made by September 15, 2011 to meet the minimum funding requirements.
Designated Disaster Areas
Plan sponsors – or those with necessary records, as noted further above – located in designated counties (see list below) in Connecticut, Massachusetts, New Jersey, New York, North Carolina, Vermont, and Puerto Rico will receive the extension of time to file. The IRS may announce additional relief for taxpayers in other areas as damage assessments continue and encourages plan sponsors and tax practitioners to monitor Tax Relief in Disaster Situations (http://www.irs.gov/newsroom/article/0,,id=108362,00.html) for updates.
As of September 8, 2011, the IRS filing extension applies to the following counties and municipalities:
• Connecticut: Fairfield, Hartford, Litchfield, Middlesex, New Haven, New London, Tolland and Windham
• Massachusetts: Berkshire and Franklin
• New Hampshire: Carroll and Grafton
• New Jersey: Atlantic, Bergen, Burlington, Camden, Cape May, Cumberland, Essex, Gloucester, Hudson, Hunterdon, Mercer, Middlesex, Monmouth, Morris, Ocean, Passaic, Salem, Somerset, Sussex, Union, and Warren
• New York: Albany, Clinton, Delaware, Dutchess, Essex, Greene, Montgomery, Nassau, Orange, Rensselaer, Rockland, Saratoga, Schenectady, Schoharie, Sullivan, Suffolk, Ulster, Warren, and Westchester
• North Carolina: Beaufort, Bertie, Brunswick, Camden, Carteret, Chowan, Craven, Currituck, Dare, Duplin, Edgecombe, Gates, Halifax, Hertford, Hyde, Johnston, Jones, Lenoir, Martin, Nash, New Hanover, Northampton, Onslow, Pamlico, Pasquotank, Perquimans, Pitt, Tyrrell, Vance, Warren, Washington, and Wilson
• Vermont: Addison, Bennington, Caledonia, Chittenden, Orange, Rutland, Washington, and Windsor
• Puerto Rico: Arroyo, Aguas Buenas, Caguas, Canovanas, Carolina, Cayey, Cidra, Coamo, Comerio, Humacao, Jayuya, Juncos, Loiza, Luquillo, Orocovis, Patillas, Ponce, and San Juan.
Reference to Form 5500 can be found in the announcement under the bold caption “Grant of
Relief.” Whatever special extension of filing Form 5500 is granted by the IRS will also be automatically permitted by the DOL and the Pension Benefit Guarantee Corporation (PBGC). Therefore, whether or not DOL and/or PBGC announce a special extension, Form 5500 series filers to whom the IRS has granted a special extension may file their annual returns/reports by the extended due date stated in the IRS’s announcement.
Filing Form 5500 Under the Relief
Plan sponsors should follow the instructions to Form 5500 series under the section “Extension of Time to File” regarding how to file the forms when special extensions are granted. Essentially, the guidance in the instructions is included under the caption “Other Extensions of Time” which advises that, if a plan sponsor is relying on an announced special extension, the sponsor should check the appropriate box on Form 5500 which is Part I, line D, and enter a description of the announced authority for the extension.
Although there is no specific language required under the current extension, the announced authority could be described as follows: “Special extension pursuant to federally designated disaster areas as listed in IR 2011‐87, originally published September 1, 2011 and subsequently updated to reflect new areas for relief, grants until October 31, 2011 to file annual Form 5500 for a retirement and welfare benefit plan.”
If you have any questions regarding this extension, please contact Saltmarsh, Cleaveland & Gund, (850) 435-8300.
© 2011 EisnerAmper LLP
This publication is intended to provide general information to our friends. It does not constitute accounting, tax, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.
Plan Sponsors Qualifying for Relief
The U.S. Department of Labor (DOL) website discusses Disaster Relief Information as follows: “Filers affected by Presidentially-declared disasters are plan administrators, employers, and other entities who file Form 5500 series that are located in the areas designated as federal disaster areas (as listed in IRS’s announcements). These special extensions also apply to filers located outside the designated disaster areas who are unable to obtain the information necessary for filing from service providers, banks or insurance companies whose operations are directly affected by the disasters.”
Impact on Plan Funding and Deductions
Because the tax relief granted by IRS includes an extension of time to file business and individual tax returns, plan sponsors will be able to take a tax deduction for contributions made to their plans for the prior period if the contributions are deposited by the new extended due date of the return and provided they have met the other requirements of Internal Revenue Code (IRC) Section 404(a).
However, sponsors of plans that are subject to the minimum funding provisions of IRC Section 412 – such as defined benefit plans, cash balance plans, and money purchase pension plans – are still required to fund these plans within 8½ months after the plan’s year end, as IRS has not granted additional time to meet the minimum funding requirements under IRC section 412. For calendar year plans, this means that contributions will still need to be made by September 15, 2011 to meet the minimum funding requirements.
Designated Disaster Areas
Plan sponsors – or those with necessary records, as noted further above – located in designated counties (see list below) in Connecticut, Massachusetts, New Jersey, New York, North Carolina, Vermont, and Puerto Rico will receive the extension of time to file. The IRS may announce additional relief for taxpayers in other areas as damage assessments continue and encourages plan sponsors and tax practitioners to monitor Tax Relief in Disaster Situations (http://www.irs.gov/newsroom/article/0,,id=108362,00.html) for updates.
As of September 8, 2011, the IRS filing extension applies to the following counties and municipalities:
• Connecticut: Fairfield, Hartford, Litchfield, Middlesex, New Haven, New London, Tolland and Windham
• Massachusetts: Berkshire and Franklin
• New Hampshire: Carroll and Grafton
• New Jersey: Atlantic, Bergen, Burlington, Camden, Cape May, Cumberland, Essex, Gloucester, Hudson, Hunterdon, Mercer, Middlesex, Monmouth, Morris, Ocean, Passaic, Salem, Somerset, Sussex, Union, and Warren
• New York: Albany, Clinton, Delaware, Dutchess, Essex, Greene, Montgomery, Nassau, Orange, Rensselaer, Rockland, Saratoga, Schenectady, Schoharie, Sullivan, Suffolk, Ulster, Warren, and Westchester
• North Carolina: Beaufort, Bertie, Brunswick, Camden, Carteret, Chowan, Craven, Currituck, Dare, Duplin, Edgecombe, Gates, Halifax, Hertford, Hyde, Johnston, Jones, Lenoir, Martin, Nash, New Hanover, Northampton, Onslow, Pamlico, Pasquotank, Perquimans, Pitt, Tyrrell, Vance, Warren, Washington, and Wilson
• Vermont: Addison, Bennington, Caledonia, Chittenden, Orange, Rutland, Washington, and Windsor
• Puerto Rico: Arroyo, Aguas Buenas, Caguas, Canovanas, Carolina, Cayey, Cidra, Coamo, Comerio, Humacao, Jayuya, Juncos, Loiza, Luquillo, Orocovis, Patillas, Ponce, and San Juan.
Reference to Form 5500 can be found in the announcement under the bold caption “Grant of
Relief.” Whatever special extension of filing Form 5500 is granted by the IRS will also be automatically permitted by the DOL and the Pension Benefit Guarantee Corporation (PBGC). Therefore, whether or not DOL and/or PBGC announce a special extension, Form 5500 series filers to whom the IRS has granted a special extension may file their annual returns/reports by the extended due date stated in the IRS’s announcement.
Filing Form 5500 Under the Relief
Plan sponsors should follow the instructions to Form 5500 series under the section “Extension of Time to File” regarding how to file the forms when special extensions are granted. Essentially, the guidance in the instructions is included under the caption “Other Extensions of Time” which advises that, if a plan sponsor is relying on an announced special extension, the sponsor should check the appropriate box on Form 5500 which is Part I, line D, and enter a description of the announced authority for the extension.
Although there is no specific language required under the current extension, the announced authority could be described as follows: “Special extension pursuant to federally designated disaster areas as listed in IR 2011‐87, originally published September 1, 2011 and subsequently updated to reflect new areas for relief, grants until October 31, 2011 to file annual Form 5500 for a retirement and welfare benefit plan.”
If you have any questions regarding this extension, please contact Saltmarsh, Cleaveland & Gund, (850) 435-8300.
© 2011 EisnerAmper LLP
This publication is intended to provide general information to our friends. It does not constitute accounting, tax, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.
Friday, September 2, 2011
QuickBooks Tips & Tricks
What is the best way to avoid making mistakes when processing transactions? The best and easiest way to avoid common mistakes in transaction processing is to use the Home Page. In QuickBooks 2006, Intuit combined all the old navigator pages into one Home Page. This page is an excellent visual guide to help you decide how to go about generating your transactions.
The golden rule is to NEVER cross the lines on the Home Page. For instance, if you enter a vendor bill, do not cross the lines and go to Write Checks to print the check for that bill. Always follow the line from your starting point, Enter Bills, to the next step, Pay Bills.
This rule of thumb works for each section on the Home Page including the Customers and Employees centers. If you follow the lines like a map you will reduce the number of errors that occur when processing transactions in QuickBooks.
Please call any of our QuickBooks ProAdvisors at (850) 435-8300, if you would like more detail on these tips or if you have any other QuickBooks questions.
The golden rule is to NEVER cross the lines on the Home Page. For instance, if you enter a vendor bill, do not cross the lines and go to Write Checks to print the check for that bill. Always follow the line from your starting point, Enter Bills, to the next step, Pay Bills.
If you enter a bill and then use the Write Checks option to pay it, you will double your expense and your Accounts Payable account will continue to grow.
If you use the Pay Bills option to generate your vendor checks as shown below, you will reduce the balance of your payable account and the expense will only be recorded through the Bill you enter.
This rule of thumb works for each section on the Home Page including the Customers and Employees centers. If you follow the lines like a map you will reduce the number of errors that occur when processing transactions in QuickBooks.
Please call any of our QuickBooks ProAdvisors at (850) 435-8300, if you would like more detail on these tips or if you have any other QuickBooks questions.
Wednesday, August 17, 2011
QuickBooks Tips & Tricks
Why do I have Accounts Receivable/Accounts Payable balances on my cash basis balance sheet (CBBS)? There are several reasons this may occur. If you have a transaction that is linked to a balance sheet account instead of an income or expense account, that transaction will appear as an open invoice or bill in Accounts Receivable or Accounts Payable. If you enter an invoice or bill and then enter a deposit without a payment or write a check instead of creating a bill payment, the transactions will not have a link to clear their balance and these transactions will also appear on the cash basis report as open transactions.
To fix these problems there are some reports you can run that will identify the transactions that need to be cleared.
Open Invoices report
1. Choose Reports > Customers & Receivables > Open Invoices.
2. Click the Date drop-down arrow and select the correct date.
3. Click Modify report, Advanced, and then click As of Report Date.
The payments that appear on the report (included in the CBBS) have been received but not applied to an invoice.
Unpaid Bills report
1. Choose Reports > Vendors & Payables > Unpaid Bills Detail.
2. Click the Date drop-down arrow and select the correct date.
3. Click Modify report, Advanced, and then click As of Report Date.
The bill payment checks that appear on the report (included in the CBBS) have been entered but not applied to a bill.
Customer Transaction Detail report
Each customer with a nonzero subtotal is affecting your A/R balance. To identify customer transactions that are causing an A/R balance to show on your CBBS, run the following report:
1. Choose Reports > Company & Financial > Balance Sheet Standard.
2. Click Modify Report.
3. On the Display tab, for Report Basis select Cash.
4. Delete the From date, keep the To date, and click OK.
5. To bring up the Transactions by Account report, double-click (QuickZoom) the A/R amount.
6. Click Modify Report.
7. On the Display tab, delete the From date and keep the To date.
8. Click Advanced, select the Open Balance / Aging Report Date option, and click OK.
9. Select Customer in the Total by field.
10. Click the Filters tab:
a. In the Filter list, click Account.
b. Click the Account drop-down arrow and select All Accounts Receivable.
c. Select No for Include Split Detail.
d. In the Filter list, select Paid Status, select Open, and then click OK.
e. (Optional) Click Memorize to save this report to use again.
Vendor Transaction Detail report:
Each vendor with a nonzero subtotal is affecting your A/P balance. To identify vendor transactions that are causing an A/P balance to show on your CBBS, run the following report:
1. Choose Reports > Company & Financial > Balance Sheet Standard.
2. Click Modify Report.
3. On the Display tab, for Report Basis, select Cash.
4. Delete the From date, keep the To date, and click OK.
5. To bring up the Transactions by Account report, double-click (QuickZoom) the A/P amount.
6. Click Modify Report.
7. On the Display tab, delete the From date and keep the To date.
8. Click Advanced, select the Open Balance / Aging Report Date option, and click OK.
9. In the Total by field, select Vendor.
10. Click the Filters tab:
a. In the Filter list, click Account.
b. Click the Account drop-down arrow and select All Accounts Payable.
c. For Include Split Detail, select No.
d. In the Filter list, select Paid Status, select Open, and then click OK.
e. (Optional) Click Memorize to save this report to use again.
Please call any of our QuickBooks ProAdvisors at (850) 435-8300, if you would like more detail on these tips or if you have any QuickBooks questions.
To fix these problems there are some reports you can run that will identify the transactions that need to be cleared.
Open Invoices report
1. Choose Reports > Customers & Receivables > Open Invoices.
2. Click the Date drop-down arrow and select the correct date.
3. Click Modify report, Advanced, and then click As of Report Date.
The payments that appear on the report (included in the CBBS) have been received but not applied to an invoice.
Unpaid Bills report
1. Choose Reports > Vendors & Payables > Unpaid Bills Detail.
2. Click the Date drop-down arrow and select the correct date.
3. Click Modify report, Advanced, and then click As of Report Date.
The bill payment checks that appear on the report (included in the CBBS) have been entered but not applied to a bill.
Customer Transaction Detail report
Each customer with a nonzero subtotal is affecting your A/R balance. To identify customer transactions that are causing an A/R balance to show on your CBBS, run the following report:
1. Choose Reports > Company & Financial > Balance Sheet Standard.
2. Click Modify Report.
3. On the Display tab, for Report Basis select Cash.
4. Delete the From date, keep the To date, and click OK.
5. To bring up the Transactions by Account report, double-click (QuickZoom) the A/R amount.
6. Click Modify Report.
7. On the Display tab, delete the From date and keep the To date.
8. Click Advanced, select the Open Balance / Aging Report Date option, and click OK.
9. Select Customer in the Total by field.
10. Click the Filters tab:
a. In the Filter list, click Account.
b. Click the Account drop-down arrow and select All Accounts Receivable.
c. Select No for Include Split Detail.
d. In the Filter list, select Paid Status, select Open, and then click OK.
e. (Optional) Click Memorize to save this report to use again.
Vendor Transaction Detail report:
Each vendor with a nonzero subtotal is affecting your A/P balance. To identify vendor transactions that are causing an A/P balance to show on your CBBS, run the following report:
1. Choose Reports > Company & Financial > Balance Sheet Standard.
2. Click Modify Report.
3. On the Display tab, for Report Basis, select Cash.
4. Delete the From date, keep the To date, and click OK.
5. To bring up the Transactions by Account report, double-click (QuickZoom) the A/P amount.
6. Click Modify Report.
7. On the Display tab, delete the From date and keep the To date.
8. Click Advanced, select the Open Balance / Aging Report Date option, and click OK.
9. In the Total by field, select Vendor.
10. Click the Filters tab:
a. In the Filter list, click Account.
b. Click the Account drop-down arrow and select All Accounts Payable.
c. For Include Split Detail, select No.
d. In the Filter list, select Paid Status, select Open, and then click OK.
e. (Optional) Click Memorize to save this report to use again.
Please call any of our QuickBooks ProAdvisors at (850) 435-8300, if you would like more detail on these tips or if you have any QuickBooks questions.
Monday, August 15, 2011
Lee Bell Quoted in Tampa Bay Business Journal
Tampa, FL -- Shareholder Lee Bell was quoted in an article reporting on community banks in the Tampa metropolitan area in the Friday, August 12 edition of the Tampa Bay Business Journal. Friday, August 12, 2011
Saltmarsh Hosts Anti-Money Laundering Seminar
Orlando, FL - Saltmarsh hosted (together with the Anti-Money Laundering Association and the Association of Certified Fraud Examiners) a seminar, Understanding and Detecting Money Laundering - for financial institution clients and friends. The speaker was Jonathan Turner. Mr. Turner has appeared on ABC News and CNN and is an expert in the investigation and documentation of financial fraud. He brought his entertaining and informative presentation about how money is laundered - great and timely information.
Stephen Macbeth, Dede Nolan, Suzi Fernandez, William Borde, Julie Sbrocco, Kristen Stogniew, Nathan Botts and Lee Bell of Saltmarsh, Cleaveland & Gund were in attendance as well.
Friday, August 5, 2011
Protecting Your Financial Personal Information
Phishing sounds like something you might enjoy doing on a hot summer day. Phishing, unlike fishing, can be dangerous…that is to your personal information. Phishing is a scam typically carried out through unsolicited email or through websites claiming to be legitimate sites which lure the unsuspecting victims to provide personal information such as social security numbers, credit card numbers or passwords. Be aware that the IRS does not initiate taxpayer communication through email or request detailed personal information through email. If you receive a suspicious IRS communication, do not reply, open attachments, or click on links, instead simply forward to phishing@irs.gov and put "suspicious email or website" in the subject line and then delete the email. The IRS tries to respond to these suspicious emails within 24 hours, but not necessarily with an email. If a website was involved, check to see if it was shut down.
Wednesday, August 3, 2011
IRS Provides Limited Extension of August 31, 2011 Deadline for Offshore Voluntary Disclosure Initiative
Background
For U.S. taxpayers not fully disclosing their offshore financial accounts on required foreign bank account reports (FBARs) for part or all of the eight years 2003-2010, the U.S. Treasury Department has adopted a new Offshore Voluntary Disclosure Initiative (OVDI) limiting penalties on such late disclosures. This has been scheduled to close on August 31, 2011, by which date all documents must be submitted by the taxpayer.
Observation: This August 31, 2011 deadline has not provided taxpayers and their advisors much time to enter the new OVDI and provide all relevant documents to the Internal Revenue Service (IRS).
Limited extension of deadline
Recognizing that taxpayers may not be able to make a complete submission by August 31, 2011, the IRS has updated its Frequently Asked Questions and Answers under the OVDI as follows:
“FAQ 25.1. A taxpayer may request an extension of the deadline to complete his or her submission if the taxpayer can demonstrate a good faith attempt to fully comply with FAQ 25 [discussing submissions required to enter the OVDI] on or before August 31, 2011.”
Observation: The FAQ contemplates a maximum extension of up to 90 days, or until November 30, 2011.
The FAQ provides three conditions to such an extension:
1. Filing of properly completed and signed agreements to extend the period of time to assess tax (including tax penalties) and to assess FBAR penalties;
2. Including in the request for extension a statement of those items that are missing, the reasons why they are not included, and the steps taken to secure them; and
3. The request being made in writing and sent on or before August 31, 2011 to: Internal Revenue Service, 3651 S. I H 35 Stop 4301 AUSC, Austin, TX 78741, ATTN: 2011 Offshore Voluntary Disclosure Initiative.
Observation: The FAQ does not provide examples of reasons for missing items and steps taken to secure them, which will help demonstrate a good faith attempt to comply. However, many taxpayers and advisors have experienced difficulties or delays in obtaining complete details of foreign financial accounts, in spite of written and other inquiries to institutions holding those accounts.
If you have any questions regarding the above, please contact Saltmarsh, Cleaveland & Gund, (850) 435-8300.
© 2011 EisnerAmper LLP
This publication is intended to provide general information to our friends. It does not constitute accounting, tax, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.
For U.S. taxpayers not fully disclosing their offshore financial accounts on required foreign bank account reports (FBARs) for part or all of the eight years 2003-2010, the U.S. Treasury Department has adopted a new Offshore Voluntary Disclosure Initiative (OVDI) limiting penalties on such late disclosures. This has been scheduled to close on August 31, 2011, by which date all documents must be submitted by the taxpayer.
Observation: This August 31, 2011 deadline has not provided taxpayers and their advisors much time to enter the new OVDI and provide all relevant documents to the Internal Revenue Service (IRS).
Limited extension of deadline
Recognizing that taxpayers may not be able to make a complete submission by August 31, 2011, the IRS has updated its Frequently Asked Questions and Answers under the OVDI as follows:
“FAQ 25.1. A taxpayer may request an extension of the deadline to complete his or her submission if the taxpayer can demonstrate a good faith attempt to fully comply with FAQ 25 [discussing submissions required to enter the OVDI] on or before August 31, 2011.”
Observation: The FAQ contemplates a maximum extension of up to 90 days, or until November 30, 2011.
The FAQ provides three conditions to such an extension:
1. Filing of properly completed and signed agreements to extend the period of time to assess tax (including tax penalties) and to assess FBAR penalties;
2. Including in the request for extension a statement of those items that are missing, the reasons why they are not included, and the steps taken to secure them; and
3. The request being made in writing and sent on or before August 31, 2011 to: Internal Revenue Service, 3651 S. I H 35 Stop 4301 AUSC, Austin, TX 78741, ATTN: 2011 Offshore Voluntary Disclosure Initiative.
Observation: The FAQ does not provide examples of reasons for missing items and steps taken to secure them, which will help demonstrate a good faith attempt to comply. However, many taxpayers and advisors have experienced difficulties or delays in obtaining complete details of foreign financial accounts, in spite of written and other inquiries to institutions holding those accounts.
If you have any questions regarding the above, please contact Saltmarsh, Cleaveland & Gund, (850) 435-8300.
© 2011 EisnerAmper LLP
This publication is intended to provide general information to our friends. It does not constitute accounting, tax, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.
Monday, August 1, 2011
Hager and Stogniew - Two Good Cops at the Florida School of Banking
Gainesville, FL - Two of our banking shareholders, Alex Hager and Kristen Stogniew kicked off the 2011 Florida School of Banking for it its Junior class today on the campus of the University of Florida. Alex and Kristen covered the topics of, "How to Survive a Safety & Soundness Exam" and "How to Survive a Compliance Exam". There was no 'good cop/bad cop' here as they worked together to shed light on regulatory compliance to the future leaders of Florida banking.
Tuesday, July 19, 2011
New Guidance Phases in FATCA Implementation
Recently, the IRS issued Notice 2011-53, the third Notice that addresses the Foreign Account Tax Compliance Act (FATCA), which was enacted in March 2010. Title V of that Act was about making sure that Americans could not hide assets in foreign bank accounts and essentially evade U.S. tax laws.
FATCA requires foreign financial institutions (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% 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 pass-thru payments.
The prior two Notices, 2010-60 and 2011-34 outlined the way in which the IRS expects to implement the law. These are the basis for "final regulations."
Many banks, brokers, funds and others affected by the impending regulations lobbied for repeal or significant revisions More recently, there have been calls for some kind of phased implementation to allow firms to assess the nature and scope of changes they need to make both to client-facing procedures such as account opening, and to back office systems which, in some cases, may need to be re-built.
Notice 2011-53 essentially spreads the implementation period out across 2013 to 2015 with different bits of the regulation coming into force at different times.
Notice 2011-53 provides a more 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.
If you have any questions, please contact Saltmarsh, Cleaveland & Gund, (850) 435-8300.
© EisnerAmper LLP 2011
This publication is intended to provide general information to our friends. It does not constitute accounting, tax, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.
FATCA requires foreign financial institutions (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% 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 pass-thru payments.
The prior two Notices, 2010-60 and 2011-34 outlined the way in which the IRS expects to implement the law. These are the basis for "final regulations."
Many banks, brokers, funds and others affected by the impending regulations lobbied for repeal or significant revisions More recently, there have been calls for some kind of phased implementation to allow firms to assess the nature and scope of changes they need to make both to client-facing procedures such as account opening, and to back office systems which, in some cases, may need to be re-built.
Notice 2011-53 essentially spreads the implementation period out across 2013 to 2015 with different bits of the regulation coming into force at different times.
Notice 2011-53 provides a more 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.
If you have any questions, please contact Saltmarsh, Cleaveland & Gund, (850) 435-8300.
© EisnerAmper LLP 2011
This publication is intended to provide general information to our friends. It does not constitute accounting, tax, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.
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