Pub. 8 2018 Issue 3

12 AUTOMOBILE DEALER NEWS ILLINOIS www.illinoisdealers.com S ince the advent of the internet dealers increasingly see customers who live far from the dealership, including those from foreign countries. Before you sell a vehicle to a customer who will export it outside of the United States, there are several items to consider. (1) New or Used? The first thing to consider is whether the vehicle is new or used. It is not illegal to sell new vehicles to foreign customers, but most dealer sales and service agreements prohibit the sale of new vehicles to foreign customers. Some sales and service agreements maintain lists of prohibited new vehicle foreign customers. Before selling a new unit to a foreign customer, you should carefully review your sales and service agreement to make sure you don’t cost yourself factory sales incentives. Ad- ditional information about exporting new units can be found in the December 22, 2010 IADA bulletin in our bulletin archive at www.illinoisdealers.com. (2) OFAC. The U.S. Treasury’s Office of Foreign Assets Con- trol (OFAC) prohibits all U.S. persons from doing business with specially designated organizations and persons. OFACmaintains a list of persons with whom you may not conduct business on its Specially Designated Nationals and Blocked Persons (SDN List) at: http://www.treasury.gov/resource-center/sanctions/SDN- List/Pages/default.aspx. You should make sure you check your buyer against the SDNList. Additional information can be found on the Treasury’s website at: www.treas.gov/offices/enforcement/ ofac/faq/#gen_ques. The OFAC Provisions apply to all sales but take some added importance in sales to foreign customers. (3) Identity Theft Red Flags. A customer using a stolen iden- tity to purchase a vehicle can lead to a big headache for dealer- ships. All dealers are required to have an Identity Theft Red Flags program in place, which should be reviewed annually. Although the Identity Theft Red Flags provisions apply to all transactions, foreign customers merit a bit of extra attention, especially if the customer does not come into your dealership. Additional infor- mation about Identity Theft Red Flags programs can be found at: https://d3dkdvqff0zqx.cloudfront.net/groups/ilada/attach- ments/20150731121911071.pdf. (4) Cash in Excess of $10,000. If you receive more than $10,000 in cash in a single transaction or in related transactions, the IRS requires you to report it on Form 8300. General information Sales To Foreign Customers