Your Israeli Bank Asked You to Sign a W-9? What FATCA Is and Why You Can't Ignore It

More and more Israeli-Americans open a letter from their bank and find "W-9" or "FATCA" across the top. Some panic and picture a huge tax bill; some set the letter aside and hope it goes away — and both reactions can be costly. Here's what's really behind that request, and why it needs handling.

What FATCA is

FATCA is a US law requiring financial institutions worldwide to identify customers who are "US persons for tax purposes" and report their accounts. Israel signed an intergovernmental agreement ⁦(IGA)⁩ with the US in 2014, and ever since, Israeli banks report Americans' accounts to the Israel Tax Authority — which passes the information to the IRS, usually by March 31 each year.

Why you specifically were contacted

The bank looks for "US indicia": a US place of birth, US citizenship or a Green Card, a US address or phone, or standing transfer instructions to a US account. One of these showing up is enough — and the bank sends a request to sign a W-9, a declaration that you're a US person, including an SSN — or a W-8BEN if you're certifying you're not.

Why you can't ignore it

The bank's request has a deadline — usually 30 to 60 days. Anyone who doesn't respond may find their account restricted, frozen, and in extreme cases even closed, because the bank must classify you to comply with the law. Ignoring it doesn't make you disappear from the system; it only complicates your relationship with the bank that holds your money.

The opposite fear: "if I sign, they'll tax me"

Here it's worth pausing to understand: signing a W-9 is an identity declaration and disclosure — not a tax payment. On its own it obligates you to nothing. What it does do is expose a gap, if you're a US citizen who hasn't filed tax returns and FBARs. And in that case the solution isn't to hide — it's to regularize the filing, for example via the Streamlined program, which in most cases ends with no tax owed at all thanks to the credits.

And if I don't have an SSN?

Many Americans in Israel — especially those born to Americans or granted citizenship in childhood — never obtained an SSN, and the bank needs it for exactly the W-9. Don't have one? It can be obtained, and often the smartest move is to do it as part of a single orderly package: the SSN together with regularizing the filing.

How we help

We decode exactly what the bank asked, make sure you respond correctly and on time, and coordinate the filing regularization with US CPAs if needed — including obtaining an SSN if it's missing. Don't leave the bank's letter for "next week": send it to us and we'll tell you exactly what to do.