Treasury finalizes FATCA rules

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WASHINGTON, Jan. 17 (UPI) -- The Treasury Department said Thursday it had issued finalized rules for the Foreign Account Tax Compliance Act, designed to fight offshore tax evasion.

The act, signed into law in 2010, is intended to force foreign financial institutions -- called FFIs -- to identify taxable accounts and turn over names to the IRS.

"These regulations give the Administration a powerful set of tools to combat offshore tax evasion effectively and efficiently," said Deputy Secretary Neal Wolin in a statement. "The final rules mark a critical milestone in international cooperation on these issues, and they provide important clarity for foreign and U.S. financial institutions."

The Treasury said FFIs can provide information on accounts to the IRS directly or they can pass information over to their own governments, which will then forward it to the IRS.

The department said Norway had agreed to cooperate with FATCA, joining Britain, Mexico, Denmark, Ireland, Switzerland and Spain as countries that have signed or initialed model agreements for compliance.

The department said it is working with 50 other countries and jurisdictions "to curtail offshore tax evasion."

"More signed agreements are expected to follow in the near future," the Treasury said.