FATCA (Foreign Account Tax Compliance Act) was enacted in 2010 by Congress to target non-compliance by USA taxpayers using foreign accounts. FATCA requires foreign financial institutions (FFIs) to report to the Internal Revenue Service (IRS) information about financial accounts held by USA taxpayers, or by foreign entities in which USA taxpayers hold a substantial ownership interest.
Lithuania among other foreign countries is obliged to sign the agreement with the USA called Intergovernmental agreement (IGA) that derives from the USA tax legislation FATCA by the end of 2014. Under the agreement financial institutions all over the world are required to identify and report the aggregated amounts on accounts held by USA persons to the local tax authority, who report to the USA IRS.
