Tax & Accounting Blog

NRA Withholding and Reporting on Payments to Foreign Nationals – Part 2: How Do I Know if My Organization Is a Withholding Agent?

NRA Withholding and Reporting on Payments to Foreign Nationals – Part 2: How Do I Know if My Organization Is a Withholding Agent?

The IRS defines withholding agent very broadly. Every U.S. or foreign person who controls, holds custody of, receives, disposes of, or pays any item of income to a foreign person that is subject to NRA withholding is a withholding agent. A withholding agent includes (without limitation) individuals, corporations, partnerships, trusts, associations or any other entity … Read More

Trustee and Custodian Requirements to Issue Transfer Statements

Trustee and Custodian Requirements to Issue Transfer Statements

Transfer statements are required as a means of passing along adjusted basis information on tax lots of covered securities when these are transferred to a receiving custodian or broker. Transfer statements are also required to inform a receiving custodian or broker which items are uncovered securities; a transferred security is presumed to be a covered security unless … Read More

Worker Classification Compliance: Maine Adopts Legislation Defining “Independent Contractor”

Worker Classification Compliance: Maine Adopts Legislation Defining “Independent Contractor”

“Worker classification” is the term used for the process of identifying which workers must be treated as employees of your organization, and which workers must be treated as legitimate nonemployee independent contractors. Worker classification cases are a major focus for the IRS and for many state governments as well, and there is cooperation among federal and state … Read More

FATCA Conference in New York Highlights Industry Concerns

FATCA Conference in New York Highlights Industry Concerns

At the EEI 24th Annual Forum on International Tax Withholding and Information Reporting in New York on June 5-6, members of the U.S. and foreign financial industries met with key representatives of the IRS to explore the latest on FATCA regulations and implementation. Requirements from the USFI perspective were examined along with those from the FFI … Read More

Paying Foreign Employees Part 6: Income Reporting

Paying Foreign Employees Part 6: Income Reporting

Wages paid to foreign employees are reported on Form W-2 with the following exceptions: Treaty-exempt wages of nonresident employees are reported on Form 1042-S Wages paid to H-2A Agricultural Workers (both residents and nonresidents) are reported on Form 1099 MISC if the amount paid during the calendar year equals or exceeds $600 Wages paid … Read More

FATCA Public Hearing: Requests for Postponement of Effective Dates but No Immediate IRS Response

FATCA Public Hearing: Requests for Postponement of Effective Dates but No Immediate IRS Response

The IRS public hearing on the proposed regulations for FATCA (Foreign Account Tax Compliance Act), REG-121647-10, was held on May 15, 2012. More than 20 speakers were on the agenda, and 199 comment letters received by the IRS were posted online at http://www.regulations.gov/#!docketDetail;dct=O%252BSR%252BPS;rpp=25;po=0;D=IRS-2012-0009 (or see http://www.regulations.gov/ for Docket ID IRS-2012-0009). FATCA law established a new Chapter … Read More