THE USA and Ireland signed a reciprocal bilateral agreement setting out the Model I government-to-government approach to implementing the Foreign Account Tax Compliance Act, an agreement that will significantly increase the amount of tax information automatically exchanged between the two countries and improve International Tax Compliance. Article 7 contains a most favored nation provision giving Ireland the benefit of any more favorable terms the United States later enters into with another jurisdiction. Article 8 provides for consultations between the parties if difficulties arise during implementation of the agreement and for amendments by written mutual consent. Article 9 clarifies that the annexes form an integral part of the agreement.

The agreement provides that Irish financial institutions will report to the Irish Revenue Commissioners in respect of US account-holders. In exchange, US financial institutions will be required to report to the IRS in respect of any Irish-resident account-holders. This information will then be automatically exchanged by the two tax authorities on an annual basis. The US and Ireland already have a double tax agreement (DTA) in place, but the Irish Finance Department stresses that the new deal will go a step further by providing for the annual automatic exchange of more detailed information.