Report on the February 2015 FATCA Doorknock

During the week starting Monday February 23, 2015 Democrats Abroad was part of a "delegation" of representatives** from the following organisations representing Americans living outside the US which had a series of meetings in Washington DC about FATCA:

  • American Citizens Abroad (ACA)
  • Association of Americans Resident Overseas (AARO), 
  • Democrats Abroad (DemsAbroad), and
  • Federation of American Women’s Clubs Overseas (FAWCO) and FAWCO Alumni USA (FAUSA).

Subgroups of the members of the delegation conducted 35 meetings across the five days** with the offices of these officials and discussed 1) the adverse impact FATCA is having on Americans abroad[1] and 2) reforming the FATCA implementation rules to create a Safe Harbor from FATCA reporting for Americans abroad[2] and the banks and brokerage houses they have accounts with.

Senate Finance Committee (SFC)

Orrin Hatch (R-UT)

Ron Wyden  (D-OR)

Charles Schumer (D-NY)

Mark Warner (D-V)

Ben Cardin (D-MD)

Bob Menendez (D-NJ)

Tom Carper (D-DE)

Michael Bennet (D-CO)

Debbie Stebenow (D-WA)

Office of SFC Minority Staff

 

House Ways & Means Committee (HW&MC)

Sandy Levin (D-MI)

Richard Neal (D-MA)

Sam Johnson (R-TX)

Kevin Brady (R-TX)

Office of HW&MC Minority Staff

 

 US Treasury

National Taxpayer Advocate

White House Council of Economic Advisers

Senate

Minority Leader Harry Reid (D-NV)

Majority Leader Mitch McConnell(R-KY)

Rand Paul (R-KY) anti-FATCA legislation sponsor

Mike Lee (R-UT) anti-FATCA lawsuit advocate

Sheldon Whitehouse (D-RI) FATCA legislation sponsor

Barbara Mikulski (D-MD)

Kirsten Gillibrand (D-NY)

Jeff Merkley (D-OR)

Al Franken (D-MN)

Jon Tester (D-MT)

 

House

Minority Leader Nancy Pelosi (D-CA)

Carolyn Maloney (D-NY) Americans Abroad Caucus Co-Chair

Chelli Pingree (D-MA)

Dina Titus (D-NV)

Mike Honda (D-CA)

Scott Tipton (R-CO)

It was a highly productive week.  Our most important take-away was advice from Deputy Assistant Secretary of the Treasury – International Affairs Robert Stack.  The advice was that Treasury would have the authority to implement the Safe Harbor reform to FATCA, and no legislative instrument (a laborious and time-consuming amendment to the Act) would be required. 

In order to motivate Treasury to create an Americans abroad Safe Harbor from FATCA reporting, however, we need to convince Treasury, and others we spoke to, that it would an effective policy adjustment.  They want evidence that the financial account closures we are observing are attributable to FATCA.  Also, they seek assurances from foreign financial institutions that they would end their “lock-out” of American customers if their financial accounts in their country of residence were excused from all FATCA reporting, (ie reporting by the taxpayer and reporting by the financial institution.)

RESPONDING TO TREASURY

The Task Force now has its work cut out for it.  We are determined to strike while the iron is hot!

We need the help of Americans abroad.

1.     Tying account closures and new account refusals to FATCA

  • We have refreshed our request for Americans abroad to send us redacted copies of bank communications –letters, emails or policy statements - that document a link between the bank’s rejection of US customers and their obligation to comply with FATCA.  Bank documents - with personal details deleted – can be sent to FATCA@democratsabroad.org.
  • We have a number of documents sent to us by Americans abroad who responded to our June/July 2014 FATCA Survey, in which we also made this request.  But FATCA was fully implemented in July 2014 and we suspect that many banks changed their policy regarding American accounts in the months following.
  • We urge Americans abroad to spread the word about our need for this information and we guarantee that full confidentiality will be preserved.
  • ACA and AARO are also collecting documents for presentation to Treasury and Congress in the follow-up to our meetings, presenting detailed information on financial account closures and service denials.

 2.     Demonstrating that the Safe Harbor will cause foreign financial institutions to resume servicing US customers

  • ACA has already engaged in discussions with banks to test the Safe Harbor rule.  Where we have contacts with banks, large and small, (Netherlands, Ireland, Czech Republic, Singapore and Australia, so far) DemsAbroad is doing the same.
  • We are also engaging with banking associations, meeting with them to present this important FATCA reform and assess its potential to end the “lock outs”.
  • The Task Force is preparing a guide that country committee leaders can use to meet with banks and banking associations.  We hope these associations can provide feedback about the FATCA Safe Harbor. 

 WHAT ABOUT CONGRESS?

There were some wonderful results from our meetings with Congress members.  We have engaged at least 8 in Congress to not only support the FATCA Safe Harbor, but to also act as “champions” for the reform in getting others in Congress to support it.

We have detailed notes on each meeting and we will be preparing responses to each that correspond to the particular issues raised.  Many wanted to hear accounts of difficulties FATCA has caused voters from their state; fortunately (in a way?), our 2014 survey data is a treasure trove of FATCA horror stories to draw upon.  Some wanted to review our materials and see the letter to Treasury and the IRS in support of the Safe Harbor that we and our colleagues at ACA, AARO and FAWCO/FAUSA are asking Congress to sign on to.  And others asked the same question that Treasury asked:  if Americans abroad are provided a Safe Harbour from FATCA reporting for accounts in their country of residence, will the banks end the service “lock out”.  So we will be briefing them on our work to answer that question.

Please do send through any questions.

DEMOCRATS ABROAD FBAR/FATCA Task Force

Jim Black (US – formerly DA Germany)

DeeDee Gierow (Sweden)

Joe Green - co-Chair (Canada)

Stanley Grossman (UK)

Maureen Harwood (Canada)

Carmelan Polce - co-Chair (Singapore)

Joe Smallhoover (France)

Katie Solon – International Chair (Germany)



**  Not all organisations were represented at all meetings.  The "delegation" members had to split up to cover this much ground in only a week.   ACA had a representative in three of the 35 meetings and was instrumental in organising the meeting at US Treasury.  We are grateful to ACA, AARO, FAWCO and FAUSA, without whom the meetings would have been far less interesting and the door knock would have been far less effective.

[1] See attached “February 2015 FATCA Door Knock Discussion Points.”