New Identification Number Implemented for Certain Foreign Information Returns
Effective January 1, 2012, taxpayers who file Forms 5471, 8858, and 8865 may provide a Unique Reference Identification number (URI) (defined below) for the foreign entity with respect to which reporting is required. The use of a URI is optional for tax years of foreign entities beginning in 2011, but will be required in subsequent tax years. Advance notice of the mandatory use of the new URI for tax years of foreign entities beginning in 2012 is hereby given so that users of Forms 5471, 8858, and 8865 have sufficient time to make the necessary programming and recordkeeping changes with respect to this new information collection. This advance notice is required by Code section 6038(a)(3).
You may view the draft tax forms which contain this new information collection at Draft Form Pick List. The new requests for information are located at:
Form 5471, page 1, line 1b(2)
Form 8858, page 1, line 1b(2)
Form 8865, page 1, line F2(b)
An example of the instructions for these new URI entry spaces is presented below. We anticipate that the December 2012 revision of the instructions for Form 5471, new line 1b(2) will read as follows.
Item 1b(2) -- Reference ID number
A reference ID number is required in item 1b(2) only in cases where no EIN was entered in item 1b(1). However, filers are permitted to enter both an EIN in item 1b(1) and a reference ID number in item 1b(2). If applicable, enter in item 1b(2) the reference ID number (defined below) you have assigned to the foreign corporation identified in item 1a.
A "reference ID number" is a number established by or on behalf of the U.S. person identified at the top of page 1 of the form that is assigned to a foreign corporation with respect to which Form 5471 reporting is required. These numbers are used to uniquely identify the foreign corporation in order to keep track of the foreign corporation from tax year to tax year. The reference ID number must meet the requirements set forth below.
Note. Because reference ID numbers are established by or on behalf of the U.S. person filing Form 5471, there is no need to apply to the IRS to request a reference ID number or for permission to use these numbers.
You are required to enter an EIN in item 1b(1) or a reference ID number in item 1b(2). Failure to do so may result in a penalty. See Penalties on page 3 for additional information.
Note. The reference ID number assigned to a foreign corporation on Form 5471 generally has relevance only on Form 5471 and should generally not be used with respect to that foreign corporation on any other IRS tax form.
Requirements. The reference ID number that is entered in item 1b(2) must be alphanumeric. No special characters are permitted. The length of a given reference ID number is limited to 50 characters. The same reference ID number must be used consistently from tax year to tax year with respect to a given foreign corporation. If for any reason a reference ID number falls out of use (for example, the corporation no longer exists due to disposition or liquidation), the reference ID number used for that corporation cannot be used again.
There are some situations that warrant correlation of a new reference ID number with a previous reference ID number. For example:
- In the case of a merger or acquisition, a Form 5471 filer must correlate the new reference ID number assigned to the foreign corporation by the acquirer with the previous reference ID number used by the target.
- In the case of a foreign corporation that makes an entity classification election on Form 8832, a Form 5471 filer must correlate the new reference ID number with the old reference ID number.
You must correlate the reference ID numbers as follows: New reference ID number followed by the old reference ID number(s).
Note. This correlation requirement applies only to the first year the new reference ID number is used.
We may add examples at a later date to further illustrate the application of these correlation rules.
Comments may be emailed to Tax Forms. Alternatively, written comments should be sent to: Internal Revenue Service, Tax Products Coordinating Committee, SE:W:CAR:MP:T:T:SP, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Comments must be received by December 1, 2011.