The Foreign Account Tax Compliance Act is designed to improve tax compliance for foreign assets in offshore accounts. Under FATCA, US taxpayers with specified foreign financial assets (such as bank accounts, foreign stock, partnership interests, foreign mutual funds, even foreign life insurance) that exceed certain thresholds must report those assets to the IRS via Form 8938.
FATCA is also impacting US expats and the international banks and fund managers who have US citizen clients. Effectively, foreign financial institutions are required to report any of their clients who are US citizens to the IRS. If they fail or refuse to do so, they will be counted as non-participating and liable for a 30% withholding tax on all American assets; given that the American equity and bond market is the largest in the world, they feel obligated to register.
For those living abroad, FATCA affects you if you have account values of more than $200,000 on the last day of the tax year or $300,000 as a peak value throughout the year for single filers (this amount doubles for people who are married filing jointly).