On November 6, the IRS issued its final reminder alert that the deadline for all Qualified Intermediary (“QI”) (including Qualified Derivatives Dealer (“QDD”)), Withholding Foreign Partnership (“WP”) and Withholding Foreign Trust (“WT”) applications for the 2019 year is November 15, 2019.

In general, a QI agreement allows a foreign intermediary to simplify its obligations as a withholding agent under chapters 3 and 4 and as a payor under chapter 61 and section 3406 for amounts paid to its account holders. Similarly, a WP or WT agreement allows a foreign partnership or foreign trust to assume the withholding and reporting obligations under chapters 3 and 4 for certain payments of U.S.-source income (such as interest, dividends, and royalties) made to its partners, beneficiaries, or owners.

Applicants seeking to have an agreement in effect for 2019 must submit an application through the IRS’s online system. Note that applicants will typically need to obtain a Global Intermediary Identification Number (“GIIN”) prior to submitting an application. For more information about QI agreements, see Revenue Procedure 2017-15. For more information about WP and WT agreements, see Revenue Procedure 2017-21.

Tags: GIIN, QDD, QI, Qualified Derivatives Dealer, Qualified Intermediary, withholding foreign partnership, withholding foreign trust, WP, WT
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Photo of Michael M. Lloyd Michael M. Lloyd

Michael Lloyd practices in the areas of tax and employee benefits with a focus on information reporting and withholding on cross-border payments (e.g., Forms 1042 and 1042-S) and Foreign Account Tax Compliance Act (FATCA), backup withholding, employment taxation, the treatment of fringe benefits…

Michael Lloyd practices in the areas of tax and employee benefits with a focus on information reporting and withholding on cross-border payments (e.g., Forms 1042 and 1042-S) and Foreign Account Tax Compliance Act (FATCA), backup withholding, employment taxation, the treatment of fringe benefits, cross-border compensation, domestic information reporting (e.g., Forms W-2, 1099, 1095 series returns), penalty abatement, and general tax planning and controversy matters. Michael advises large U.S. and foreign multinationals regarding compliance with information reporting and withholding issues, as well as a range of other federal and state tax issues.

Michael completed a three-year term on the IRS Information Reporting Program Advisory Committee (IRPAC) in 2013, during which time he worked with the IRS on FATCA, the Affordable Care Act (ACA or Obamacare) reporting issues, tip reporting, Form 1099-K reporting issues, and civil penalty administration. He has testified before the U.S. Treasury Department and the IRS regarding proposed federal tax regulations.

Michael’s experience includes serving as Tax Manager for a publicly traded multinational, where he managed federal and state tax examinations and appeals, including matters involving foreign taxes. In addition, he performed domestic and international tax planning, including issues related to the repatriation of foreign earnings, U.S. export tax benefits, research credits, and planning for foreign expansion.

Michael has appeared as a guest speaker on IRS Live and at seminars hosted by Tax Executives Institute (TEI), Thomson Reuters OneSource, IRSCompliance, the American Payroll Association (APA), the Blue Cross and Blue Shield Association, the National Association of College and University Business Officers (NACUBO), and the National Restaurant Association.

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Photo of S. Michael Chittenden S. Michael Chittenden

Michael Chittenden practices in the areas of tax and employee benefits with a focus on the Foreign Account Tax Compliance Act (FATCA), information reporting (e.g., Forms 1095, 1096, 1098, 1099, W-2, 1042, and 1042-S) and withholding, payroll taxes, and fringe benefits. Michael advises…

Michael Chittenden practices in the areas of tax and employee benefits with a focus on the Foreign Account Tax Compliance Act (FATCA), information reporting (e.g., Forms 1095, 1096, 1098, 1099, W-2, 1042, and 1042-S) and withholding, payroll taxes, and fringe benefits. Michael advises companies on their obligations under FATCA and assists in the development of comprehensive FATCA and Chapter 3 (nonresident alien reporting and withholding) compliance programs.

Michael advises large employers on their employment tax obligations, including the special FICA and FUTA rules for nonqualified deferred compensation, the successor employer rules, the voluntary correction of employment tax mistakes, and the abatement of late deposit and information reporting penalties. In addition, he has also advised large insurance companies and employers on the Affordable Care Act reporting requirements in Sections 6055 and 6056, and advised clients on the application of section 6050W (Form 1099-K reporting), including its application to third-party payment networks.

Michael counsels clients on mobile workforce issues including state income tax withholding for mobile employees and expatriate and inpatriate taxation and reporting.

Michael is a frequent commentator on information withholding, payroll taxes, and fringe benefits and regularly gives presentations on the compliance burdens for companies.

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