Last week, the IRS issued Notice 2023-11 providing relief procedures for foreign financial institutions (“FFIs”) in countries with Model 1 intergovernmental agreements (“IGAs”) that have failed to provide U.S. taxpayer identification numbers (“TINs”) for certain preexisting accounts. Preexisting accounts are defined in Model 1 IGAs as a financial account maintained by a reporting financial institution as of June 30, 2014. Those FFIs in eligible Model 1 IGA jurisdictions that comply with the procedures described in the notice will avoid being identified by the U.S. Competent Authority as being in significant non-compliance with the IGA. (A list of U.S. IGAs, including Model 1 IGAs, along with other useful information regarding the status of all IGAs may be found at the Treasury’s FATCA page.)Continue Reading Treasury and IRS Extend Olive Branch to Reporting Model 1 FFIs and Model 1 IGA Jurisdictions Regarding U.S. TIN Reporting for Certain U.S. Accounts
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Administration Proposes W-9 Requirement for More Reportable Payments
By S. Michael Chittenden on
Last week, the Treasury Department released the “Green Book,” formally known as the General Explanations of the Administration’s Revenue Proposals. Among its proposals, the Green Book suggests the expansion of the requirement to collect Forms W-9 to additional payments.
Under current law, payors are required to backup withhold…
Continue Reading Administration Proposes W-9 Requirement for More Reportable Payments
American Rescue Plan Act Clarifies Scope of Form 1099-K Reporting and Reduces De Minimis Threshold
On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 (the “ARPA”) into law. The ARPA includes clarifying language regarding the scope of Form 1099-K (Payment Card and Third Party Network Transactions) reporting for third party payment networks and a change to the de minimis reporting standard applicable to third party settlement organizations (“TPSOs”) effective for returns required to be filed for 2022.
Continue Reading American Rescue Plan Act Clarifies Scope of Form 1099-K Reporting and Reduces De Minimis Threshold
IRS Posts Tax Tip on Backup Withholding
On October 14, 2020, the IRS posted Tax Tip 2020-136 entitled, “Helpful information for taxpayers on backup withholding.” This particular Tax Tip serves as a great reminder for payers making payments for which backup withholding is required, especially if they are unaware of the troubling consequences of noncompliance.
Continue Reading IRS Posts Tax Tip on Backup Withholding
The IRS Introduces More Informative Backup Withholding Notices for Payers
On November 14, 2019, the IRS announced that it has redesigned Notices CP2100 and CP2100A with the goal of providing more information to affected payers. These Notices are used to alert payers that the IRS received Forms 1099 containing incorrect or missing Taxpayer Identification Numbers (TINs) for payees and that the payer may need to contact payees regarding their name and TIN information and/or backup withhold at a rate of 24% as a result. Payments potentially subject to backup withholding are reportable payments, such as interest (including tax-exempt interest), dividends, broker and barter exchange transactions, rents, royalties, nonemployee compensation, payments made in settlement of payment card and third party network transactions, and certain payments from fishing boat operators.
Continue Reading The IRS Introduces More Informative Backup Withholding Notices for Payers