Foreign financial institutions and governments might initially have groaned when the U.S. Congress passed the Foreign Account Tax Compliance Act in March 2010, but it looks like at least some of them are starting to come around. In February, the U.S. Treasury announced it had partnered with five European nations ...
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Partners and Details Firming around FATCA
1042-S, 1099, Document and WorkFlow Management, FATCA, Global Tax Compliance, Information Reporting for Wealth Management, ONESOURCE, Tax Information Reporting, TIN Compliance, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on April 11, 2012
New Cost Basis Rules May Be Lost on Many
1042-S, 1099, 6050W, Cost-Basis Reporting, Information Reporting for Wealth Management, ONESOURCE, Tax Information Reporting, TIN Compliance, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 1 CommentPosted on April 9, 2012
With taxpayers in the throes of planning their 2011 income tax returns, now’s a good time to remind filers not to overlook new cost basis reporting rules governing securities sales. In the past, they had the option of specifying which shares they sold when computing their cost basis. But as of ...
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FATCA Proposed Regulations Are Issued by IRS
1042-S, 1099, FATCA, Information Reporting for Wealth Management, ONESOURCE, Tax Information Reporting, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on February 8, 2012
The long-awaited proposed tax regulations for FATCA, the Foreign Account Tax Compliance Act, were issued February 8 by the IRS. An electronic copy is available at http://www.irs.gov/pub/newsroom/reg-121647-10.pdf . FATCA imposes new disclosure obligations on foreign financial institutions that maintain U.S. accounts, and on certain non-financial foreign entities; and FATCA establishes new ...
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Penalties for Failure to Comply with NRA Withholding and 1042-S Information Reporting: Part 2 – A Penalty for Late Deposit
1042-S, FATCA, ONESOURCE, Tax Information Reporting, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on February 1, 2012
The IRS prescribes when deposits of NRA withholding are required in IRS Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Entities. A payer who fails to make a required deposit of withheld taxes within the time prescribed is liable for a penalty on the underpayment (i.e., the excess of the ...
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Penalties for Failure to Comply with NRA Withholding and 1042-S Information Reporting – Part 1
1042-S, 1099, FATCA, ONESOURCE, Tax Information Reporting, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on January 18, 2012
In August of 2010, the IRS announced "executing our international strategy is a top priority, and our work continues to intensify in this area." Included in this strategy is a requirement for examiners to review withholding and reporting on payments to foreign individuals and entities during corporate audits. Other organizations should anticipate ...
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Form 1042-S: IRS Alerts Payers to the Correct Use of Codes for Unknown Recipient and Unknown Country
1042-S, 1099, FATCA, ONESOURCE, Tax Information Reporting, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on January 10, 2012
A perennial problem in Form 1042-S reporting, noted by the IRS in the current edition of Publication 1187, is misreporting which results from the payer not making correct use of Unknown Recipient (recipient code 20) and Unknown Country (country code UC). UC is used as a country code only when you ...
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Why the Nature of Income Paid to Foreign Vendors Matters
1042-S, 1099, FATCA, ONESOURCE, Tax Information Reporting, Trust Tax, W-8 & W-9 Foreign Reporting 0 CommentPosted on December 29, 2011
U.S. organizations making payments to vendors must determine whether the vendor is a U.S. person or a non-U.S. person because only payments to U.S. persons (actual or presumed) are covered by Form 1099 rules and procedures. The term, U.S. persons, includes U.S. citizens, resident aliens (based on I.R.C. Section 7701(b), ...
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Residency for Treaty Purposes: Corporations
1042-S, 1099, FATCA, ONESOURCE, Tax Information Reporting, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on December 27, 2011
The United States has income tax treaties with over 60 countries for the purpose of avoiding double taxation. The Residency Article of an applicable income tax treaty sets forth rules for determining which entities and individuals (collectively, persons) are residents of a country for purposes of the treaty. As the IRS ...
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When a Foreign Vendor Needs a U.S. Taxpayer Identification Number
1042-S, FATCA, ONESOURCE, TIN Compliance, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on December 22, 2011
The IRS is in the process of enforcing compliance of long-standing rules requiring U.S. tax withholding on U.S.-source income payments to nonresident aliens and foreign entities (collectively, foreign persons). As a result, foreign vendors are being asked by their clients to provide them with a U.S. withholding certificate to document ...
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Understanding FATCA – Part 2 of 3
1042-S, 1099, FATCA, Information Reporting for Wealth Management, ONESOURCE, Tax Information Reporting, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on December 13, 2011
The Foreign Account Tax Compliance Act (FATCA) is intended to increase transparency for the IRS with respect to US persons that may be investing and earning US income through non-US institutions. It is clear that the new FATCA reporting and withholding regime will impact not only processes and procedures designed to ...
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New W-9 (Rev. Dec 2011) Released
1042-S, 1099, 6050W, Cost-Basis Reporting, Document and WorkFlow Management, FATCA, Information Reporting for Wealth Management, ONESOURCE, Tax Information Reporting, TIN Compliance, Trust & Estate Administration, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on November 16, 2011
Over the past nine months, the IRS received multiple complaints about the recently released W-9 (Rev. Jan 2011). Criticism centered on the tax classification area, where the word, required, was added. This led filers to believe that the tax classification section was mandatory, where, in fact, it is not. Due to the high number of ...
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QIs Have No Choice with Regard to FATCA
1042-S, 1099, 6050W, Cost-Basis Reporting, Document and WorkFlow Management, FATCA, Information Reporting for Wealth Management, ONESOURCE, Tax Information Reporting, TIN Compliance, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on November 7, 2011
In last week’s EEI conference, it was announced that Qualified Intermediaries (QIs) will have no choice but to register to become a Participating Foreign Financial Institution (PFFI). This announcement came as quite a shock to some of the QIs that attended the Washington event, who assumed that they have the choice ...
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Positive Future Changes for the W-8BEN
1042-S, 1099, 6050W, Cost-Basis Reporting, Document and WorkFlow Management, FATCA, Information Reporting for Wealth Management, ONESOURCE, Tax Information Reporting, TIN Compliance, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on November 3, 2011
In last week’s EEI conference, Michael Danilack, Deputy Commissioner at the IRS, announced some positive changes for those having to collect and audit the W-8BEN. The term he used was "clearing the underbrush" which, in essence, means that the IRS is aware that they have been too strict on the validation rules ...
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Join Us at the Tax Information Reporting Forum
1042-S, 1099, 6050W, Cost-Basis Reporting, Document and WorkFlow Management, FATCA, Information Reporting for Wealth Management, ONESOURCE, Tax Information Reporting, TIN Compliance, Trust Tax, W-8 & W-9 Foreign Reporting, Withholding Management 0 CommentPosted on October 19, 2011
Information Reporting (1099) is becoming more complicated and the risks relating to non-compliance or inaccurate reporting are high. The recent changes to FATCA, 1099 reporting, 1042 and 1042-S, foreign reporting and cost-basis reporting will affect your business, whether it's a corporation, a bank, a trust department or a wealth management ...
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