Bermuda residents and their connectivity to the United States.We Bermuda residents don’t want to think about, let alone talk about United States tax and immigration issues. These topics are nowhere near as much fun as the planned anticipation for the next US trip, especially the traditional shopping tripat magical US Thanksgiving time. Reinforcing that fact, Royal Gazette readers consistently tell me that they like the Moneywise articles, except for the United States tax-focused ones, and honestly why do I bother writing about them anyway? US tax topics don’t have much to do with ordinary Bermuda resident life.That, dear readers, is a misconception. You would be rather surprised at the consistent number of Moneywise readers who also contact me on a routine basis asking (often in an abstract or hypothetical way) what they should do about their US connections?Are a few readers a good reason for this focus? The answer is absolutely yes, because there may be more than a few good readers that are already affected, may be affected, or don’t even know that they will be affected by United States tax and reporting compliance now.It has to do with Bermuda resident (and US connected) demographics and the impending United States FATCA regulations for Bermuda (and the world with effect in January 2014) that were stirred up again with the very high-profile recent G8 conference in the United Kingdom. For many months now, all of our financial institutions, brokerage and investment firms, trust and insurance companies and other related Bermuda and global financial firms are highly focused on meeting compliance regulations with the US IRS Foreign Account Tax Compliance Act (FATCA). Very recently, our Minister of Finance, the Hon. ET (Bob) Richards, JP MP, announced that the Bermuda Government had signed an Intergovernmental Agreement with the United States whereby Bermuda institutions would report all account information relative to foreign financial accounts and interests held by US persons in Bermuda directly to US Internal Revenue Service.Who are United States persons in Bermuda? The numbers are estimated since no one really knows exactly (including the US CIA World data), but approximately 10 to 15 percent (around 6,000-8,000) of our Bermuda resident population has direct tax, immigration, and legal ties to the United States, either through actual or accidental US citizenship and green card status. At least another 10 to 20 percent of Bermuda residents are not US citizens or green card holders, but have large indirect US connections (even though they may never have lived in the United States) through businesses, property holdings, investment accounts, overstaying vacationers, immediate and not so close relatives who are US citizens or green card holders and the like. Now, that is a very large number of people out of a population of 60,000. So, US tax, immigration, legal, investment, retirement, pension, estate and trust, and risk management articles focused on United States connectivity are not only relevant, but crucially important information for this large segment of Moneywise readers.Reader questions are derived in every form and from all sorts of situations. Questions such as the following: Should I give up my green card? Should I expatriate? Will I, or do I owe taxes? How do I know that I am considered a United States citizen? I was adopted as a baby by English parents and have always lived outside the United States — am I a US citizen? What happens to the family property if I’m married to a US citizen or a green card holder? I’m not a United States citizen, but my children and grandchildren are. I’m now concerned that they will have to pay some huge United States tax if I give them (or loan them) money, property, plus they are beneficiaries in my will, my trust, and on my bank accounts. By the way, why should another government get big piece of my Bermuda estate that I have worked so hard to accumulate over my lifetime. How unfair is that?Just to begin comprehending the complex new world we live in, means clearly understanding family history and migration patterns. Knowing who you are becomes a very important step in the pending global financial compliance identification initiatives:Who are you?Where did you come from?Where were you born?Who are your parents and grandparents?What countries have you lived in and for how long?Who have you worked for and where have you worked?How did you enter that country: visa, passport, work permit, spouse or employer sponsorship, refugee status?Who is your current spouse and what is his/her nationality?If single now, were you married before? If so, what was your former spouse’s nationality and citizenship?What is their background, citizenship and nationality?The endless array of situations that can arise cannot begin to be listed here, and we haven’t even broached the tax and compliance processes. Should you be paying attention to your financial affairs, far more than you might have in the past? Yes. You are in the electronically and physically connected global village today. You need to know exactly how your life — and the changes therein — fits with the rest of the world. That way, there are no surprises.So, you see why I have to write about these boring tax issues from time to time — because for those that may be caught in that net, the potential for family financial involvement must be considered, planned for, or ruled out, if appropriate. Connectivity to other country’s taxing regimes across borders can happen to any family. One day you have nothing to do with the United States (except for shopping), then suddenly, you are involved: a new member enters the family relationships, you decide to accept a new position abroad, your long-lost US relative has designated you as a beneficiary, or vice versa, a difficult or unexpected pregnancy welcomes the new arrival in United States medical facilities, or you receive a letter from United States Internal Revenue Service requesting information on your foreign bank accounts.FATCA updateThe United States is not the only country employing the use of the FATCA regime. Other countries have started similar processes to identify their domestic citizen residents who have financial activities and accounts in other jurisdictions. In the near future, the UK, France, Germany, Italy, Spain and other OECD countries are preparing for, or have already launched their country’s version of FATCA programs (like the US pilot) based on the long-term G8 and OECD goal of a “global system of automatic information exchange.” Just a few weeks ago, Mexico announced a new FATCA initiative in collaboration with certain OECD countries.Martha Harris Myron JP CPA PFS CFP is a Bermudian journalist and a cross border financial planning specialist providing offshore financial perspectives for international citizens living, working, crossing borders, and straddling ponds in the North Atlantic Quadrangle: United States, Canada, United Kingdom, Europe, and the island of Bermuda, the premier international finance centre.President of Pondstraddler? Life™ Consultancy.Publications, Presentations and Seminars. www.pondstraddler.cominfo@pondstraddler.com