Enacted in 2010, FATCA requires foreign financial institutions (FFIs) to report information about financial accounts held by U.S. taxpayers or foreign entities in which U.S. taxpayers hold substantial ownership. It aims to enhance tax compliance of U.S. citizens and residents who are using offshore accounts to evade taxes. The law imposes a 30% withholding tax on certain payments made to FFIs that don't comply with these reporting requirements.