Friday, May 9, 2014

IRS Released Forms 8966 & 1042 Updated For FATCA Reporting Requirements

On March 5, 2014 the Internal Revenue Service released new versions of three critical forms to help financial institutions and withholding agents meet the requirements of the Foreign Account Tax Compliance Act, including draft versions of Form 8966 and Form 1042-S, and a final version of Form 1042.
Form 8966, FATCA Report, is a new form that foreign financial institutions (FFIs) would use to report information on their U.S. account holders under the 2010 law. The statute requires FFIs to report accounts held by U.S. taxpayers to the IRS or face, in some cases, a 30% withholding tax on certain U.S. source payments that are made to them.
Form 1042-S now incorporates FATCA and includes ways to account for withholding under Chapter 4 of the tax code. In one specific update to the new draft, the IRS added a space for a payer's Global Intermediary Identification Number in situations where the payer and the withholding agent aren't the same.

Do You Have Unreported Foreign Income?
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