The US and Israel have signed an Inter-Governmental Agreement (IGA) regarding FATCA. FATCA (the Foreign Account Tax Compliance Act) was enacted by the U.S. congress in 2010 to combat tax evasion of American citizens using foreign accounts. This agreements requires Israeli financial institutions to report information on foreign financial assets owned by U.S. citizens to the Israeli Tax Authority, which will forward this information to the US government.

The agreement will officially take place as soon as the Knesset passes legislation enabling enforcement. Regulations will also need to be drafted.

Financial institutions include not only banks, but also investment companies and certain insurance companies.

The full text of the agreement can be downloaded through the following link:
https://www.treasury.gov/resource-center/tax-policy/treaties/Documents/FATCA-Agreement-Israel-6-30-2014.pdf

The content of this article is intended to provide general information on the subject and is not a substitute for a tax consultation.