On 19 and 20 September 2018, the U.S. Internal Revenue Service (“IRS”) updated its Frequently Asked Questions (“FAQs”) on Qualified Intermediary (“QI”), Withholding Foreign Partnership (“WP”) and Withholding Foreign Trusts (“WT”) (Link). Questions 13 in each section “Registration Update” and “FATCA Certifications” has been updated to support users in understanding the respective requirements.
The new FAQs include the following:
Section: FATCA Certifications
- Question 13: When are the FATCA certifications due?
Answer 13: For the certification period ending December 31, 2017, FATCA certifications are generally due no later than December 15, 2018; however, for sponsoring entities and trustees of a trustee-documented trusts, they are due no later than March 31, 2019.
Section: Registration Update
- Question 13: What are the most common errors made during the registration process?
Answer 13: Address Line cannot be a website address.
1) Registration Part 1, Number 1: Financial Institution Type: If selecting Sponsoring Entity, a QI EIN should not be provided. The QI EIN should only be used for QI purposes (section 2.66 of Revenue Procedure 2017-15).
2) Registration Part 1, Number 2: Legal Name of Financial Institution: Cannot be left blank or abbreviated; use full legal name (for Lead, Member, Single, Sponsoring, Sponsored, etc.). Also remember to check the spelling of the FI name.
3) Registration Part 1, Number 4: FI’s FATCA classification in its country/jurisdiction: The FATCA classification selected should be consistent with the IGA in force.
4) Registration Part 1, Number 5: Mailing Address of Financial Institution: Required fields cannot be left blank or contain erroneous information.
5) Registration Part 1, Number 6: in reference to withholding agreement as QI/WT/WP EIN of the FI: If you have not registered with the IRS QI/WT/WP program and received a valid TIN for this purpose, do not insert a number or select any of the aforementioned statuses.
6) Registration Part 1, Number 10: FATCA RO for FI:
Legal Last Name (Family) and Legal First Name (Given): Fields cannot be left blank or contain erroneous information, initials, nicknames or the name of a company; must include full first and last names of a natural person.
◦ FI that is a trust inserts name of law firm as name of RO.
◦ RO first name is one or two initials, no middle name provided.
◦ RO name contains title or FI name.
◦ RO first, middle and last names are identical.
Business Address Lines 1 and 2 for RO: Cannot be left blank or contain erroneous information. Cannot contain a website address.
Country/Jurisdiction for RO: Cannot be left blank. Must correspond with city location.
Business Telephone Number for RO: Cannot be left blank and cannot be fictitious (ex. 222-222-2222).
Business Email Address for RO: Cannot be left blank or contain a comma. Use period/dot, not comma (email will be returned on messages sent by IRS to RO/POC).
7) Registration Financial Institution Agreement, Signature and Certification: Certification (bottom of registration page) cannot be left blank or contain anything other than a natural person’s full name (first and last). Cannot contain the FI Legal Name.
8) In-process or Test Accounts in FATCA registration system: Do not ‘submit’ a test, fictitious or in-process account; rather leave the information in ‘initiated’ status. If “submitted”, your account will be placed into “Under Review” by IRS and therefore cannot be accessed without first contacting the IRS.