Due to reporting regulations introduced by the IRS in 2010, Americans who leave the States to live abroad are finding it increasingly difficult to find banking and financial advice services and are facing considerable restrictions when it comes to investment and retirement accounts. 

The introduction of the Foreign Account Tax Compliance Act (FACTA) made it a requirement for US citizens to report their foreign account holdings that meet certain thresholds to the IRS. Designed to prevent Americans from hiding money offshore to avoid taxation, the act has had a detrimental effect on any US citizens who have moved abroad. FATCA also applies large penalties to foreign banks who fail to disclose any US connected accounts to the IRS. The additional workload for banks and financial institutions associated with this reporting, and the penalties they could face if found to be non-compliant, have resulted in many firms simply turning away US clients instead.

The problems for US expats extend to investments made before leaving the US. Every year more US based investment providers are restricting or closing accounts held by US expats. This can be due to a variety of factors but, more often than not, it comes down to the costs of being regulated to serve clients outside the US.
Every year more investment accounts and retirement accounts held by US expats are being restricted or closed.

Our experienced adviser, Luke Staden, who specialises in this area states that ‘If you have a US retirement scheme which takes action against you, in a best case scenario you will be restricted from trading. In the worst case scenario you will be asked to find a new retirement account custodian or have your account closed altogether which can have overwhelming tax and early access penalties. I think it’s important for all US expats to get advice on how to protect themselves from a worst case scenario.’

How can we help?

Blacktower Financial Management Group of companies are licensed and regulated in several jurisdictions including within the EU and the US.

We have a host of advisers whose local knowledge and experience are invaluable in complex scenarios like these, giving them the relevant expertise to assess your investment and retirement account options to ensure you are pursuing an efficient and compliant course of action.

If you would like to arrange a complimentary consultation to discuss your investment and financial planning options as a US citizen, you can do so by clicking the link below.

This communication is for informational purposes only based on our understanding of current legislation and practices which are subject to change and are not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.