SCOTUS Declines Case Questioning Constitutionality of FATCA
The Supreme Court of the United States (SCOTUS) declined to hear a case that questions the constitutionality of the Foreign Account Tax Compliance Act (FATCA).
A group of American expatriates brought the case against the government based on the contention that it violated their Fourth Amendment protections and the law has resulted in financial loss.
A review of the history of the case, which court heard it last? The case was dismissed earlier by the Sixth Circuit. The court found that the plaintiffs lacked standing to sue. The plaintiffs appealed this decision to SCOTUS. In response, SCOTUS has declined to hear the case.
What does SCOTUS’s decision to decline to hear the case mean? Essentially, this decision means this specific suit can no longer move forward.
Will FATCA remain? FATCA will likely continue to face challenges through a variety of different channels. The law has faced challenges since its inception, with Kentucky Senator Rand Paul often leading the charge.
Senator Paul provides an example of one of the ways the law will continue to face challenges. The senator has introduced legislation that would repeal the law. He shares the same belief as to the group of expatriates noted above and joined them in their lawsuit. He has stated the law “disregards the Fourth Amendment and privacy rights by requiring the collection of innocent Americans’ financial records.” He has also stated it stunts foreign investment opportunities and is a “job- and privacy-killing law.”
North Carolina United States Representative Mark Meadows has joined in support of this bill, stating the law “goes well beyond what is permissible under Fourth Amendment protections and places a serious burden on taxpayers.”
In the meantime, it is important that taxpayers ensure their foreign financial accounts are in full compliance with applicable tax law.
