- 1 Foreigners Registering with TWSE and FBAR/FATCA
- 2 Investing in Taiwan TWSE & FATCA/FBAR
- 3 US Person Registered with TWSE and FBAR/FATCA Audit Risk
- 4 FBAR Amnesty Program for Taiwan TWSE Investment Accounts
- 5 Can I Just Start Filing Past FBAR for Taiwan Accounts in the Current Year?
- 6 Our FBAR Lawyers Represent Clients Worldwide
Foreigners Registering with TWSE and FBAR/FATCA
Taiwan Depository Clearing Corp and FBAR/FATCA: With the globalization of the world economy, many foreign countries that did not previously allow for foreigners to invest within its borders have loosened some of the restrictions for noncitizens and residents of their countries to invest. One example of this is in Taiwan, which now permits certain nonresident/noncitizens to invest into the market in Taiwan (TWSE: Taiwan Stock Exchange). Typically, this is done by registering through the Taiwan Depository and Clearing Corp (TDCC). A common question we receive is whether or not Taiwan investment accounts are reportable on the FBAR.
Investing in Taiwan TWSE & FATCA/FBAR
The process to register in Taiwan with the TWSE has become more simplified. As provided by the TWSE (Taiwan Stock Exchange):
In Taiwan, foreign investors are required to register with the TWSE so as to obtain an “Investor ID” before opening a trading account with a local securities firm.
TWSE has simplified this registration process and related documentation.
US Person Registered with TWSE and FBAR/FATCA Audit Risk
When a person registers with the Taiwan Stock Exchange, they have to provide a significant amount of information necessary to satisfy the requirements in Taiwan. For US persons who register, there is the risk that TWSE may report to the US government the names of individuals who have registered. In addition, since Taiwan has entered into a model 2 FATCA Agreement, the Foreign Financial Institutions in Taiwan are already reporting to the US government. this increases the risk of a US person being audited by the IRS for noncompliance with overseas reporting.
FBAR Amnesty Program for Taiwan TWSE Investment Accounts
The FBAR Amnesty Programs are programs developed by the Internal Revenue Service to assist Taxpayers who are already out of compliance for non-reporting; non-filing of Taiwan Investment Accounts used to invest in TWSE can be remedied through these programs.
Some of the more common programs, include:
- Voluntary Disclosure Program (VDP or “New” OVDP)
- Streamlined Domestic Offshore Procedures
- Streamlined Foreign Offshore Procedures
- Delinquency Procedures
- Reasonable Cause
Can I Just Start Filing Past FBAR for Taiwan Accounts in the Current Year?
No, unless the current year is the first-year you had an FBAR Reporting requirement. If you had a prior year reporting requirement, but only begin to start filing in the current year (Filing Forward) it is illegal. In the world of offshore disclosure, this is referred to as an FBAR Quiet Disclosure. The IRS has warned taxpayers that if they get caught in a FBAR Quiet Disclosure situation, it may lead to willful penalties and even a criminal investigation by the IRS Special Agents.
Our FBAR Lawyers Represent Clients Worldwide
Our FBAR Lawyer team specializes exclusively in international tax, and specifically IRS offshore disclosure.
Contact our firm today for assistance.