Tax & Accounting Blog

Recent Developments in FATCA Intergovernmental Agreements and Implementation

Recent Developments in FATCA Intergovernmental Agreements and Implementation

The United Kingdom released Guidance Notes and draft regulations covering internal UK administration of rules for identification and certification of financial institutions, classification and reporting of accounts, and reporting of certain accountholder information under the intergovernmental agreement (IGA) with the United States for implementation of the U.S. Foreign Account Tax Compliance Act. Under the … Read More

Why Nature of Income Matters on Payments to Foreign Vendors

Why Nature of Income Matters on Payments to Foreign Vendors

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 IRC §7701(b) tax residency rules], and domestic entities. … Read More

IRS Issues Draft of Form 1042 for 2014, to Report Withholding on U.S. Source Income of Foreign Persons

IRS Issues Draft of Form 1042 for 2014, to Report Withholding on U.S. Source Income of Foreign Persons

The IRS has issued a draft of Form 1042 for calendar year 2014 reporting. The first use of the new version of this information reporting form will be the reconciliation of 2014 withholding, due date Match 15, 2015. A draft of the form can viewed on the IRS website. The IRS has not yet … Read More

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IRS Releases Schema of the List of FATCA-compliant Foreign Financial Institutions

Under FATCA, payers (referred to in tax parlance as “withholding agents”) must withhold tax on certain payments to foreign financial institutions (FFIs) that do not agree to report certain information about their U.S. accounts or accounts of certain foreign entities with substantial U.S. owners. An FFI may agree to report certain information about its … Read More

Form 1042/1042-S-Related Penalties Part 1: Failure to Meet Withholding Obligations.

Form 1042/1042-S-Related Penalties Part 1: Failure to Meet Withholding Obligations.

The IRS enforces compliance with withholding obligations by collecting the underwithheld tax from payers who fail to meet their obligations to withhold and timely pay overwithheld taxes. Assessments are increased for penalties as provided by the Code (and explained in the instructions for the various forms) and for interest computed on the taxes and penalties. … Read More

Thomson Reuters Nonresident Alien Taxation Educational Webcasts Begin April 23

Thomson Reuters Nonresident Alien Taxation Educational Webcasts Begin April 23

Withholding and reporting on payments to foreign employees, students, and scholars are not simple. In addition to the rules and procedures for special withholding and reporting, there are also immigration- and tax treaty-related rules and procedures to follow to ensure compliance. ONESOURCE Nonresident Alien Taxation from Thomson Reuters offers a series of educational webcasts to … Read More