This proposed piece of legislation in the United States would, upon its enactment, require additional reporting requirements for United States investors with offshore assets, to include foreign hedge and private equity funds and their respective US based investors. Furthermore the proposed Act would impose additional withholding taxes on payments to foreign entities and on dividend equivalent payments.

The Bill would expand the reporting requirements for US shareholders of PFICs (Passive Foreign Investment Companies) by mandating that each person who is a shareholder of a PFIC file an annual information return.

For further details on this proposed Bill, AFA recommends that Investment Managers and their clients consult with their legal and tax advisors.