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Foreign Account Tax Compliance Act

Foreign Account Tax Compliance Act (FATCA)

Definition

Foreign Account Tax Compliance Act (FATCA) — establishes rules for the reporting of foreign financial assets held by U.S. taxpayers in a foreign financial institution (FFI) or a nonfinancial foreign entity (NFFE). FATCA imposes a 30 percent FATCA withholding tax on withholdable payments made to an FFI or an NFFE unless the FFI or the NFFE meets certain stipulated conditions.

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