I 
111TH CONGRESS 
1ST SESSION H. R. 3933 
To amend the Internal Revenue Code of 1986 to prevent the avoidance 
of tax on income from assets held abroad, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 27, 2009 
Mr. RANGEL (for himself, Mr. NEAL of Massachusetts, Mr. STARK, Mr. 
LEVIN, Mr. VAN HOLLEN, Mr. MEEK of Florida, Mr. DAVIS of Illinois, 
and Ms. LINDA T. SA´NCHEZ of California) introduced the following bill; 
which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to prevent 
the avoidance of tax on income from assets held abroad, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Foreign Account Tax Compliance Act of 2009’’. 
(b) REFERENCE.—Except as otherwise expressly pro-
vided, whenever in this Act an amendment or repeal is 
expressed in terms of an amendment to, or repeal of, a 
section or other provision, the reference shall be consid-
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ered to be made to a section or other provision of the In-
ternal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title, etc. 
TITLE I—INCREASED DISCLOSURE OF BENEFICIAL OWNERS 
Sec. 101. Reporting on certain foreign accounts. 
Sec. 102. Repeal of certain foreign exceptions to registered bond requirements. 
TITLE II—UNDER REPORTING WITH RESPECT TO FOREIGN 
ASSETS 
Sec. 201. Disclosure of information with respect to foreign financial assets. 
Sec. 202. Penalties for underpayments attributable to undisclosed foreign fi-
nancial assets. 
Sec. 203. Modification of statute of limitations for significant omission of in-
come in connection with foreign assets. 
TITLE III—OTHER DISCLOSURE PROVISIONS 
Sec. 301. Disclosure of assistance in acquiring or forming a foreign entity. 
Sec. 302. Reporting of activities with respect to passive foreign investment com-
panies. 
Sec. 303. Secretary permitted to require financial institutions to file certain re-
turns related to withholding on foreign transfers electronically. 
TITLE IV—PROVISIONS RELATED TO FOREIGN TRUSTS 
Sec. 401. Clarifications with respect to foreign trusts which are treated as hav-
ing a United States beneficiary. 
Sec. 402. Presumption that foreign trust has United States beneficiary. 
Sec. 403. Uncompensated use of trust property treated as a distribution. 
Sec. 404. Reporting requirement of United States owners of foreign trusts. 
Sec. 405. Minimum penalty with respect to failure to report on certain foreign 
trusts. 
TITLE V—DIVIDEND EQUIVALENT PAYMENTS RECEIVED BY 
FOREIGN PERSONS TREATED AS DIVIDENDS 
Sec. 501. Dividend equivalent payments received by foreign persons treated as 
dividends. 
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TITLE 
I—INCREASED 
DISCLO-
SURE OF BENEFICIAL OWN-
ERS 
SEC. 101. REPORTING ON CERTAIN FOREIGN ACCOUNTS. 
(a) IN GENERAL.—The Internal Revenue Code of 
1986 is amended by inserting after chapter 3 the following 
new chapter: 
‘‘CHAPTER 4—TAXES TO ENFORCE RE-
PORTING ON CERTAIN FOREIGN AC-
COUNTS 
‘‘Sec. 1471. Withholdable payments to foreign financial institutions. 
‘‘Sec. 1472. Withholdable payments to other foreign entities. 
‘‘Sec. 1473. Definitions. 
‘‘Sec. 1474. Special rules. 
‘‘SEC. 1471. WITHHOLDABLE PAYMENTS TO FOREIGN FI-
NANCIAL INSTITUTIONS. 
‘‘(a) IN GENERAL.—In the case of any withholdable 
payment to a foreign financial institution which does not 
meet the requirements of subsection (b), the withholding 
agent with respect to such payment shall deduct and with-
hold from such payment a tax equal to 30 percent of the 
amount of such payment. 
‘‘(b) REPORTING REQUIREMENTS, ETC.— 
‘‘(1) IN GENERAL.—The requirements of this 
subsection are met with respect to any foreign finan-
cial institution if an agreement is in effect between 
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such institution and the Secretary under which such 
institution agrees— 
‘‘(A) to obtain such information from each 
holder of each account maintained by such in-
stitution as is necessary to determine which (if 
any) of such accounts are United States ac-
counts, 
‘‘(B) to comply with such verification and 
due diligence procedures as the Secretary may 
require with respect to the identification of 
United States accounts, 
‘‘(C) in the case of any United States ac-
count maintained by such institution, to report 
on an annual basis (at such time and in such 
manner as the Secretary may provide) the in-
formation described in subsection (c) with re-
spect to such account, 
‘‘(D) to comply with requests by the Sec-
retary for additional information with respect to 
any United States account maintained by such 
institution, and 
‘‘(E) in any case in which any foreign law 
would (but for a waiver described in clause (i)) 
prevent the reporting of any information re-
ferred to in this subsection or subsection (c) 
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with respect to any United States account 
maintained by such institution— 
‘‘(i) to attempt to obtain a valid and 
effective waiver of such law from each 
holder of such account, and 
‘‘(ii) if a waiver described in clause (i) 
is not obtained from each such holder, to 
close such account. 
‘‘(2) 
TERMINATION
OF
AGREEMENT.—Any 
agreement entered into under this subsection may be 
terminated by the Secretary upon a determination 
by the Secretary that the foreign financial institu-
tion is out of compliance with such agreement. 
‘‘(c) INFORMATION REQUIRED TO BE REPORTED ON 
UNITED STATES ACCOUNTS.— 
‘‘(1) IN GENERAL.—The agreement described in 
subsection (b) shall require the foreign financial in-
stitution to report the following with respect to each 
United States account maintained by such institu-
tion: 
‘‘(A) The name, address, and TIN of each 
account holder which is a specified United 
States person and, in the case of any account 
holder which is a United States owned foreign 
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entity, the name, address, and TIN of each sub-
stantial United States owner of such entity. 
‘‘(B) The account number. 
‘‘(C) The account balance or value (deter-
mined at such time and in such manner as the 
Secretary may provide). 
‘‘(D) The gross receipts and gross with-
drawals or payments from the account (deter-
mined for such period and in such manner as 
the Secretary may provide). 
‘‘(2) ELECTION TO BE SUBJECT TO SAME RE-
PORTING AS UNITED STATES FINANCIAL INSTITU-
TIONS.—In the case of a foreign financial institution 
which elects the application of this paragraph— 
‘‘(A) subparagraphs (C) and (D) of para-
graph (1) shall not apply, and 
‘‘(B) the agreement described in subsection 
(b) shall require such foreign financial institu-
tion to report such information with respect to 
each United States account maintained by such 
institution as such institution would be required 
to report under sections 6041, 6042, 6045, and 
6049 if— 
‘‘(i) such institution were a United 
States person, and 
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