Wednesday, April 23, 2014

IRS Updates FATCA User Guide

IRS updated Publication 5118 -Foreign Account Tax Compliance Act (FATCA) User Guide (Rev. December 2013) to reflect changes since its initial publication in the summer of 2013.

The User Guide is over 100 pages and provides instructions for completing the registration process online, including the information required, how registration will vary depending on the type of financial institution, and step-by-step guidance for answering each question.

  1. The User Guide provides a list of entities that are eligible to register, on behalf of themselves and their branches, and the purposes of such registration (page 8).
  2. In addition to fairly standard features, such as round-the-clock accessibility and the ability to establish an online account, the FATCA registration website also allows financial institutions (FIs) to appoint delegates to perform registration tasks, generates automatic notifications when FI status changes, and issues the global intermediary i.d. number (GIIN) (page 9).
  3. The exact registration process depends on the classification of the registering institution, but the general steps are to create an account, complete relevant parts of the registration form (depending on type of institution and purpose of the registration), submit the form, and receive approval and a GIIN (pages 9-13).
  4. The User Guide includes a checklist of information that a FI will be required to provide to complete the online registration form. There is a section for all FIs and additional information for certain registrants (page 17).
  5. The User Guide has special registration rules for certain situations including those involving an expanded affiliated group (EAG), an EAG that has in place a Consolidated Compliance Program under Reg. 1.1471-4(f)(2)(ii), and FIs that are treated as reporting FIs under a Model 1 or Model 2 intergovernmental agreement (IGA) (page 18).
  6. A registrant can view its account information and account status on its homepage. The account status indicates, for instance, if the registration has been submitted, is incomplete, is under review, or has been approved. The fields on the home page for the GIIN and effective date are populated once the FI is in approved status. The User Guide indicates how this status can be changed (pages 58-68). It also provides guidance for when a FI is placed in "limited conditional" status or when the registration is rejected/denied (pages 68-69) or when a FI chooses to delete its registration (pages 85-91) or cancel the agreement (pages 91-94).
  7. The User Guide includes a comprehensive glossary of FATCA-related terms (pages 111-113).
  8. Appendix E has an alphabetical list of countries with the applicable numeric code and which questions must be answered on the registration (for most countries, "all questions") (pages 116-121).

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