July.19.2013
Notice 2013-43 (http://www.irs.gov/pub/irs-drop/n-13-43.pdf), released on July 12, 2013, announces the Internal Revenue Service's (the "IRS") and the Department of the Treasury's intent to amend final Treasury regulations implementing the U.S. Foreign Account Tax Compliance Act ("FATCA") to (1) extend certain implementation dates for withholding and account due diligence and (2) specifically identify jurisdictions treated as having in force intergovernmental agreements ("IGAs") for the implementation of FATCA, including jurisdictions that have signed IGAs but have not yet brought those IGAs into force.
Taxpayers are permitted to rely on the provisions of Notice 2013-43 until amended regulations are issued.
The Notice makes the following amendments:
o withholding agent other than a PFFI or registered deemed-compliant FFI, if outstanding on June 30, 2014,
o PFFI, if outstanding on the effective date of its FFI agreement, and
o registered deemed-compliant FFI, if maintained, executed or issued prior to the later of July 1, 2014, or the date on which the FFI registers as a deemed-compliant FFI and receives a Global Intermediary Identification Number ("GIIN").
Activity |
Effective Date |
Change Made by the Notice |
Expected date the Portal will open for FATCA registration |
July 15, 2013 |
August 19, 2013 |
Registration deadline for FFIs to ensure inclusion on the IRS's electronically posted list of participating FFIs and registered-deemed compliant FFIs |
October 25, 2013 |
April 25, 2014 |
Completion of due diligence on preexisting obligations by PFFIs |
December 31, 2013 |
June 30, 2014 |
Expiration of grandfather period for issuance of obligations exempted from FATCA withholding (unless the obligation gives rise to a withholdable payment solely because obligation is treated as giving rise to a dividend equivalent under Code section 871(m) or unless the obligation requires a secured party to make a payment with respect to, or to repay, collateral posted to secure a grandfathered obligation) (See below for effective date with respect to foreign passthru payments) |
January 1, 2014 |
July 1, 2014 |
FATCA withholding required on U.S. source FDAP payments to nonparticipating FFIs |
January 1, 2014 |
July 1, 2014 |
Implementation of new account opening procedures |
January 1, 2014, or, in the case of a PFFI, by the later of January 1, 2014 or the effective date of its FFI agreement |
July 1, 2014, or, in the case of a PFFI, by the later of July 1, 2014 or the effective date of its FFI agreement |
FATCA withholding required on U.S. source FDAP payments to prima facie FFIs with respect to preexisting obligations |
July 1, 2014 |
January 1, 2015 for payments by a withholding agent other than a PFFI |
Reporting deadline for participating FFIs to file information reports with the IRS for both the 2013 and 2014 calendar year |
March 31, 2015 |
March 31, 2015, but now only applies for 2014 calendar year(no requirement to file for earlier years) |
Withholding on payments with respect to preexisting obligations that are outstanding on December 31, 2013, unless payee is a nonparticipating FFI or the payee is not prima facie FFI |
January 1, 2016 |
With respect to preexisting obligations that are outstanding on June 30, 2014. |
FATCA withholding required on gross proceeds |
January 1, 2017 |
No Change |
Withholding required with respect to foreign passthru payments |
Later of January 1, 2017 or six months after final Treasury Regulations defining a "foreign passthru payment" are issued. |
No Change |
FATCA withholding required on U.S. source FDAP payments made with respect to an offshore obligation |
January 1, 2017 |
No Change |
For a fuller discussion of the FATCA Treasury Regulations which are being amended by Notice 2013-43 see our March 2013 Tax Law Update.