FATCA - Corrections to regulations on information reporting, withholding  

June 30: The Treasury Department and IRS this morning released for publication in the Federal Register two sets of corrections to final and temporary regulations (T.D. 9657 and T.D. 9658) that were released in late February 2014 and published in the Federal Register in March 2014. These regulations were issued with an intention to harmonize the information reporting and withholding rules under Chapters 3 and 61 of the Code to the regulations under the Foreign Account Tax Compliance Act (FATCA) regime.

Read the 26-page text of the corrections [PDF 101 KB] to T.D. 9657

Read the 36-page text of the corrections PDF 141 KB] to T.D. 9658

Overview

The corrections relate to two sets of regulations—one concerning information reporting by foreign financial institutions (FFIs) with respect to U.S. accounts and withholding on certain payments to FFIs and other foreign entities, and the other concerning withholding of tax on certain U.S. source income paid to foreign persons, information reporting, and backup withholding with respect to payments made to certain U.S. persons, and portfolio interest paid to nonresident alien individuals and foreign corporations.


Read KPMG reports that provide initial analysis on the regulations as originally released: TaxNewsFlash-United States.


The preambles to today’s corrections documents state that the original final and temporary regulations contain a “number of items that need to be corrected or clarified.”


In addition to corrections of citations and cross-references, the temporary regulations are modified to clarify the relevant provisions to meet their intended purposes, as well as adding language that was inadvertently removed in the final and temporary regulations.


The corrections are effective on July 1, 2014—the date when they will be published in the Federal Register.




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