On Friday, 30 December, the Association of Accidental Americans (AAA) issued a press release welcoming the US Treasury’s guidelines for addressing the risk of bank accounts being closed.
The Internal Revenue Service (IRS), the Treasury agency that collects income tax, published a preliminary version of the notice, which provides temporary relief procedures for certain foreign financial institutions that are required to report US taxpayer identification numbers for certain preexisting accounts.
The ‘Foreign Account Tax Compliance Act’ (FATCA), a US tax law, requires foreign financial institutions to obtain the Social Security number (SSN) of individuals identified as US citizens. Yet, most ‘accidental Americans’ do not have an SSN. According to the European Banking Federation, 300,000 accidental Americans in Europe—individuals who were born in the United States but have no other ties to the country—were at risk of having their bank accounts closed.
Under pressure from the Presidency of the Council of the EU, the US Treasury agreed to look into the matter so as to find a solution. “Although this is not a permanent solution, it is a relief for hundreds of thousands of European citizens and a great victory for the Association of Accidental Americans”, said a pleased Fabien Lehagre, president of the AAA.
However, there is a chance that this US regulation might conflict with European law, which gives all citizens the right to a bank account.
To consult the IRS notice: https://aeur.eu/f/4sp (Original version in French by Anne Damiani)