Watch this Bill: Stop Tax Haven Abuse Act

This law expands reporting requirements, increases fines, and furthermore creates even a more hostile environment for ordinary US persons abroad through FATCA.
This is a demonstration of the failure of FATCA. This is also a further example of members of Congress not understanding the issues of our citizens abroad.

This is a blog post to inform our members of current legislation in Congress that impacts us. Although we will express opinions about this bill, we will let the bill speak for itself. We will continue to track the progress of this bill.

As of January 18, 2018

H.R.1932 – Stop Tax Haven Abuse Act
Sponsor Rep. Doggett, Lloyd [D-TX-35], with 60 all Dem. co-sponsors

S.851 – Stop Tax Haven Abuse Act
Sponsor Sen. Whitehouse, Sheldon [D-RI], no co-sponsor


Expanding the Rules Around FATCA


Any sponsor of this bill cannot be recommended as a candidate to receive votes from any voter abroad. We will list all sponsors.

The bill amends the Internal Revenue Code to:

  • expand reporting requirements for certain foreign investments and accounts held by U.S. persons,
  • establish a rebuttable presumption against the validity of transactions by institutions that do not comply with reporting requirements under the Foreign Account Tax Compliance Act,
  • treat certain foreign corporations managed and controlled primarily in the United States as domestic corporations for tax purposes,
  • treat swap payments sent offshore as taxable U.S. source income,
  • impose additional requirements for third party summonses used to obtain information in tax investigations that do not identify the person with respect to whose liability the summons is issued (i.e., John Doe summons), and
  • modify the rules for the taxation of inverted corporations (U.S. corporations that acquire foreign companies to reincorporate in a foreign jurisdiction with income tax rates lower than the United States).



Unfortunately, individual Congressional members have not understood that the extreme risk that “unilateral” FATCA compliance imposes has a direct impact on US residents abroad. Our interpretation of this proposal is that FATCA needs to be forced further on the same institutions that currently barely want to work with us. There is apparently no valid analysis of the impact of this proposal on US Citizens abroad.

The proposal also has a provision that if a US person receives money in a non-FATCA compliant institution, it will be “presumed” as non-reported (fines, criminal, etc.). That means you would have to prove that it was not taxable income.

The penalties for not disclosing “Offshore Holdings” increases 10x.

As far as calculating penalties, instead of using the “account balance at the time of the violation,” penalties would be changed to reflect the “highest” balance during the time of the violation.”


The Democratic Congresspersons that sponsor this bill should be made to understand that passage of this bill without no regard to the consequences of ordinary US citizens would be doubling down on crimes that they have already committed against Americans abroad. Of the 100% of the US citizens (and others) impacted by this, at least 97% are are not “fat cats”. Of the 3% remaining, we estimate that 75% are US residents.

Furthermore, US citizens abroad are already being discriminated against for being American. The Democratic party is offering nothing (in Legislation) to alleviate this.

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