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FATCA Information for Foreign Financial Institutions and Entities

FATCA Current Alerts and Other News

 

  • Under FATCA, to avoid being withheld upon, foreign financial institutions (FFIs) may register with the IRS and agree to report to the IRS certain information about their U.S. accounts, including accounts of certain foreign entities with substantial U.S. owners
  • FFIs that enter into an agreement with the IRS to report on their account holders may be required to withhold 30% on certain payments to foreign payees if such payees do not comply with FATCA
  • The FATCA regulations exempt many categories of FFIs from the requirement to register and report, including
 
  • Most governmental entities
 
  • Most non-profit organizations
 
  • Certain small, local financial institutions
 
  • Certain retirement entities
  • FFIs include, but are not limited to:
 
  • Depository institutions (for example, banks)
 
  • Custodial institutions (for example, mutual funds)
 
  • Investment entities (for example, hedge funds or private equity funds)
 
  • Certain types of insurance companies that have cash value products or annuities
  • Unless otherwise exempt, FFIs that do not both register and agree to report face a 30% withholding tax on certain U.S.-source payments made to them.
  • An FFI that registers on the “FATCA Registration Website” (“Website”), upon approval, will receive a Global Intermediary Identification Number (GIIN) from the IRS, unless the FFI is treated as a Limited FFI.
 
  • An FFI may also register on paper, but this is not recommended
  • The Website is a secure online web application that provides paperless FATCA registration accessible from anywhere in the world, 24 hours a day. Visit the FATCA Registration Resources page for registration instructions, user guide, frequently asked questions and other helpful tools.
  • IRS will publish a list of registered and approved FFIs and their GIINs every month.  An FFI List search and download tool will also be available to search this list by FI name, GIIN or country.
  • An FFI uses its GIIN to identify that it is registered and approved to:
 
  • Withholding agents and
 
  • The IRS
  • Withholding agents may rely on the IRS published list or FFI list search and download tool to verify an FFI’s GIIN and not withhold on payments made to the FFI.
  • The treatment of an FFI established in a jurisdiction with an intergovernmental agreement treated as in effect may differ from the treatment described above.  An FFI in such a jurisdiction should refer to the applicable intergovernmental agreement.
 
  • REMINDER:  For withholdable payments made prior to January 1, 2015, verification of a GIIN is not required with respect to payees that are reporting Model 1 FFIs.  As a result, reporting Model 1 FFIs will have additional time beyond July 1, 2014 to register and obtain a GIIN in order to ensure that they are included on the IRS FFI list before January 1, 2015.

 

Page Last Reviewed or Updated: 08-Apr-2014