The Common Reporting Standard follows the same principles as the Foreign Account Tax Compliance Act (FATCA), a U.S. law regarding tax reporting for accounts held abroad by U.S. persons. Since July 1, 2014, the ITA has required financial Institutions to identify accounts where the holder has U.S. tax residency, a status which specifically includes American citizens. Financial institutions are then required to send this information to the CRA, who in turn passes it on to U.S. tax authorities.
For an account holder that is a U.S. tax resident only, it is still the portion of the ITA relating to FATCA that takes precedence when it comes to the reporting of U.S. accounts by Canadian financial institutions.
With the Common Reporting Standard, Canadian financial institutions must gather information on accounts held by individuals and entities whose tax residency is outside of the United States and Canada and send it to the CRA. The CRA will then pass on the information to the appropriate tax authorities.
Learn more about FATCA regulations.