21.8.4 United States Certification for Reduced Tax Rates in Tax Treaty Countries

Manual Transmittal

August 21, 2017

Purpose

(1) This transmits revised IRM 21.8.4, International, United States Certification for Reduced Tax Rates in Tax Treaty Countries.

Material Changes

(1) Various editorial changes were made throughout the IRM. Also, cross references and hyperlinks were added, removed or revised as appropriate.

IRM Changes
IRM 21.8.4.1 Added Internal Controls - Program Scope and Objectives
IRM 21.8.4.1.1 Added Internal Controls - Background
IRM 21.8.4.1.2 Added Internal Controls - Authority
IRM 21.8.4.1.3 Added Internal Controls - Roles and Responsibilities
IRM 21.8.4.1.4 Added Internal Controls - Program Management and Review
IRM 21.8.4.1.5 Added Internal Controls - Program Controls
IRM 21.8.4.1.6 Added Internal Controls - Terms/Definitions/Acronyms
IRM 21.8.4.1.7 Added Internal Controls - Related Resources
IRM 21.8.4.1.8(1) Renumbered due to addition of Internal Controls and Removed Reference and Link to Student Guide [Previously IRM 21.8.4.1.1(1)]
IRM 21.8.4.1.11(3) Added note if a grantor trust, a grantor may sign
IRM 21.8.4.1.11(4) Updated note in most cases the TP intended to provide specific authority to the POA to sign the Form 8802
IRM 21.8.4.1.13(3) Renumbered due to addition of Internal Controls and added note to forward unprocessed tax returns to Submission Processing.
IRM 21.8.4.2.2 Updated Reference to IRM 21.3.3.4.25, Breached of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors
IRM 21.8.4.2.11(1) Updated Reference to IRM 21.3.3.4.25, Breached of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors
IRM 21.8.4.3 Updated Contact Information for Competent Authority and updated bullet to a new (2)
IRM 21.8.4.6.2(9) Removed Reference and Link to Student Guide
IRM 21.8.4.6.2(18) Updated Reference to IRM 21.3.3.4.25, Breached of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors
IRM 21.8.4.6.3(8) & (31) Removed Reference and Link to Student Guide
IRM 21.8.4.6.3(14)e Updated Due Date Chart
IRM 21.8.4.6.3(23)e Updated Reference to IRM 21.3.3.4.25, Breached of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors
IRM 21.8.4.6.3(32) Added Note: When printing a manual certification, a copy of the cover letter and certification must be kept with the case file
IPU 16U1637 issued 11-04-2016 IRM 21.8.4.6.3(34) Added guidance to review entries for accuracy before saving
IRM 21.8.4.6.4(1) Updated Guidance for Assistance with Printing Status Reports See Lead/Manager
IRM 21.8.4.6.4(3) Note Removed Reference and Link to Student Guide
IPU 16U1637 issued 11-04-2016 IRM 21.8.4.6.4(5) Updated letter to send for Status Code 605 to 4064C
IRM 21.8.4.6.4(8) Added Status Code 000 for International Taxpayers
IRM 21.8.4.6.4(10) Removed Reference and Link to Student Guide
IRM 21.8.4.6.5(2) Removed Reference and Link to Student Guide and Updated Guidance for Printing
IPU 16U1637 issued 11-04-2016 IRM 21.8.4.6.7(5)(c) Updated Fax Numbers due to convergence
IRM 21.8.4.7(1) Updated to Fit Plain Language
21.8.4.7.1(2) Updated Exception When Applicant Files Form 1040NR and Attaches Form 1040, Covering a Portion of the Year, Issue Form 6166
IRM 21.8.4.7.5(5) Updated Contact Information for Competent Authority
IRM 21.8.4.7.12.2(6) Updated Guidance to Link to Document 6209 and Document 7071-A for Inputting Name Control
IRM 21.8.4.7.12.2(9) Updated First Bullet Guidance for Substantial Presence Test and Added Link to Publication 519
IRM 21.8.4.7.12.2(17) Updated Second Bullet Guidance for Substantial Presence
IRM 21.8.4.7.12.2.1(6) Updated Guidance to Link to Document 6209 and Document 7071-A for Inputting Name Control
21.8.4.7.12.3(14) Updated if a Dual Resident Corporations Country is Australia They are not Entitled to Benefit from the Other Country.
21.8.4.7.12.3(17) Added Chile, Ecuador and Zimbabwe - Removed Kosovo
IRM 21.8.4.7.12.5 (7) Clarified Guidance for Authorizations
IRM 21.8.4.7.12.7.2(1) Added Reference to Treasury Regulation 1.6031(a)-1(b)
IRM 21.8.4.7.12.8.3(1) Updated to A Domestic Complex Trust is a Domestic Trust
IRM 21.8.4.7.12.8.6 Updated to Fit Plain Language
IRM 21.8.4.7.12.8.7(1) & (2) Updated to Fit Plain Language and Removed Legal
IRM 21.8.4.7.12.8.11(1) Removed Domestic
IRM 21.8.4.7.12.10(2) Updated First Bullet to Include “More Than One Owner” and Third Bullet to Include “Single Owner”
IRM 21.8.4.7.12.11(1) Updated to Include “An Organized Under State Law Partnership”
IRM 21.8.4.7.12.11(5) Clarified Single-Member Owners That May Receive a U.S. Residency Certification
IRM 21.8.4.7.12.12(5) Removed Reference to 501(C)(3)s are Corporations
IRM 21.8.4.7.12.12(17) Removed Reference and Link to Student Guide
IPU 16U1637 issued 11-04-2016 IRM 21.8.4.7.12.13(14) Updated letter number to 4064
IRM 21.8.4.7.13.1(1) Updated to For Purposes of Applying the Income Tax Treaties, the Commonwealth of Independent States Includes
IRM 21.8.4.7.14(5) Added Note Include Notice 1435, U.S. Certification Foreign Forms When Returning Foreign Forms the IRS Doesn’t Stamp and Updated Reference to IRM 21.3.3.4.25, Breached of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors
IPU 17U0200 issued 01-30-2017 IRM 21.8.4.7.14.1 Update Link for United Kingdom Website
IRM 21.8.4.7.14.1(7) Added Guidance for Processing Forms 8802 with attached United Kingdom Foreign Forms
IRM 21.8.4.7.14.2(7) Updated Reference to IRM 21.3.3.4.25, Breached of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors
IRM 21.8.4.7.14.4(3)d Updated Switzerland Foreign Form to 82 Series Forms
IPU 17U0200 issued 01-30-2017 Exhibit 21.8.4-1 Added Table for U.S. Certification Letter Types and Suspense Codes

Effect on Other Documents

IRM 21.8.4 dated August 17, 2016 (effective 10/01/2016) is superseded. The following IRM Procedural Updates (IPUs), issued on November 4, 2016 and on January 30, 2017, have been incorporated into this IRM: 16U637, 17U0200.

Audience

Wage and Investment Accounts Management Division, U.S. Residency Certification (USRC) Unit at the Philadelphia Campus

Effective Date

(10-01-2017)


Kevin M. Morehead
Director, Accounts Management
Wage and Investment Division

United States Residence Certification (Form 6166)Program Scope and Objectives

  1. Purpose: This IRM describes the procedures to verify evidence that a U.S. Residency Certification applicant is a United States resident for tax purposes during the tax year or period identified on the Form 8802, Application for United States Residency Certification, in order to issue a Form 6166, U. S. Residency Certificate. The certificates are primarily issued to United States (U.S.) residents that are seeking to reduce foreign withholding tax on income derived from sources within a country that has an income treaty with the United States. A certificate may also be requested for purposes of reducing a VAT tax on goods taken out of other foreign countries. The United States has tax treaties with over 60 countries. Many of these treaties provide U.S. residents a reduction, elimination or refund of the foreign country's withholding tax. The IRS residency certification, Form 6166, is accepted by many of our treaty partners as proof of U.S. residence for tax purposes for the period specified on the certification.

  2. Audience: The primary users of this IRM are Accounts Management Tax Examiners (TE), Tax Examining Clerks and Clerks who process Form 8802, Application for United States Residency Certification.

  3. Policy Owner: Director of Accounts Management

  4. Program Owner: Accounts Management, Process and Program Management, Business Management.

  5. Primary Stakeholders: Wage and Investment (W&I), LB&I and Competent Authority.

  6. Program Goals: Program goals for this type of work are included in the Accounts Management Program Letter as well as IRM 1.4.16, Accounts Management Guide for Managers.

Background

  1. Employees working the U.S. Cert program process requests received on Form 8802, Application for United States Residency Certification, as well as resolving issues with the processing of Form 8802 and issuance of Form 6166 certification.

  2. IRM 21.8.4 provides guidance to employees in Accounts Management assigned to U.S. Certification teams.

Authority

  1. Information regarding authorities delegated to Accounts Management can be found in IRM 1.4.3.3, Authorities.

Roles and Responsibilities

  1. IRM 1.1.13.9.4, Accounts Management, provides various guidance for Accounts Management employees.

  2. IRM 21.1.1, Accounts Management and Compliance Services Overview, provides guidance to employees assigned to the Accounts Management organization.

Program Management and Review

  1. IRM 1.4.16, Accounts Management Guide for Managers, provides guidance for program management and review of programs assigned to Accounts Management.

Program Controls

  1. Current year Program Letter, Measures and Operating Guidelines

  2. IRM 21.10.1, Embedded Quality (EQ) Program for Accounts Management, Campus Compliance, Field Assistance, Tax Exempt/Government, Return Integrity and Compliance Services (RICS) and Electronic Products and Services Support.

Terms/Definitions/Acronyms

  1. The ReferenceNet Legal and Tax Research Service page provides an Acronym Database to research acronyms found within this IRM.

Related Resources

  1. The following list of Internal Revenue Codes (IRC) provide additional instructions:

    • IRC 115

    • IRC 269B

    • IRC 401(a)

    • IRC 403(b)

    • IRC 408

    • IRC 410(d)

    • IRC 457(b)

    • IRC 501

    • IRC 521

    • IRC 527

    • IRC 529

    • IRC 584

    • IRC 641

    • IRC 642(c)(5)

    • IRC 664

    • IRC 761

    • IRC 860

    • IRC 953(d)

    • IRC 1361

    • IRC 1362

    • IRC 1381(a)

    • IRC 1504(d)

    • IRC 4947(a)

    • IRC 6039D

    • IRC 6058

    • IRC 6103(c)

    • IRC 7701(b)

    • IRC 7874(b)

      Note:

      Additional IRCs are cited in the IRM where they are applicable to the issue covered.

  2. The following list of IRM references provides additional instructions:

    • IRM 1.1.13.9.4, Accounts Management, provides various guidance for Accounts Management employees

    • IRM 1.4.6, Accounts Management Guide for Managers, provides guidance for program management and review of programs assigned to Accounts Management

    • IRM 1.4.16, Accounts Management Guide for Managers

    • IRM 1.4.3.3, Authorities

    • IRM 2.3, IDRS Terminal Responses

    • IRM 3.30.123, Processing Timeliness: Cycles, Criteria and Critical Dates

    • IRM 3.8.44, Campus Deposit Activity

    • IRM 11.3.1.11, Facsimile Transmission of Tax Information

    • IRM 11.3.2.4.5, Government Agencies

    • IRM 13, Taxpayer Advocate Service

    • IRM 21.1.1, Accounts Management and Compliance Services Overview, provides guidance to employees assigned to the Accounts Management organization

    • IRM 21.1.3, Operational Guidelines Overview

    • IRM 21.10.1, Embedded Quality (EQ) Program for Accounts Management, Campus Compliance, Field Assistance, Tax Exempt/Government, Return Integrity and Compliance Services (RICS) and Electronic Products and Services Support

    • IRM 21.3.3.1.1, Policy Statement P-21-3

    • IRM 21.3.3.4.25, Breaches of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors

    • IRM 21.3.7.8, Processing Third Party Authorizations onto the Centralized Authorization File(CAF), International Processing

    • IRM 21.3.8.12, Exempt Organizations (EO)

    • IRM 21.3.8.9.8, Tax Exempt/Government Entities (TE/GE) Customer Account Services (CAS) Telephone Operations, Status Codes — EO

    • IRM 21.8.2, BMF International Adjustments

    • IRM 21.8.4.6, The Certification Process

    • IRM 21.8.4.7.9, IRS Initiated Correspondence - Guidelines

      Note:

      Additional IRMs are cited in the IRM where they are applicable to the issue covered.

The Certification Principle

  1. Upon receipt of a processable Form 8802, a user fee, and all the required supporting statements and/or documentation from the certification applicant, the application will be processed.

  2. All Forms 8802 are charged a user fee. These fees were announced in Revenue Procedure 2006-35, IRB 2006-37 dated September 11, 2006, and modified by Notice 2006 - 90, IRB 2006-42 dated October 16, 2006, and modified by Revenue Procedure 2007–22, IRB 2007–10 dated March 5, 2007. As of 04-1-2012, the fee is $85 per application, regardless of the number of certificates requested. See IRM 21.8.4.2.1 , User Fees.

  3. If all certification requirements are met, the appropriate U.S. Residency certification is issued.

    Note:

    Under no circumstances will IRS certify to any fact which cannot be proved correct by evidence in office files.

  4. U.S. Residency Certification confirms, to the best of our knowledge, the individual or entity being certified is a U.S. resident that (a) that has filed a statutorily required U.S. income tax return as a resident of the United States; (b) that is not statutorily required to file a U.S. tax return; (c) that it is in its first year of existence and has not yet been required to file a tax return, and has submitted documentation to identify itself and stated, under penalties of perjury, that it anticipates filing a U.S. tax return as a resident for that tax period.

Processing Time Limits

  1. The process for issuing a certification for tax residency should be completed and final response initiated within thirty calendar days of the earliest IRS received date. Every effort must be made to provide a complete quality response in the shortest time possible.

  2. The Form 8802 is not processible until the user fee has been paid.

  3. Date stamp all Forms 8802 on the day they are received. If Form 8802 is date stamped at a later time, the date stamped on the form must reflect the actual date the Form 8802 was received by the IRS.

  4. If a Form 8802 cannot be processed within thirty days, an interim letter must be sent. Additional interim letters are to be issued every thirty days until the certification can be issued.

  5. An interim letter must:

    1. Identify the reason a final response is delayed,

    2. Specify when the final response will be mailed, and

    3. Include the name, telephone number, organizational code symbols, and the unique identification number of the contact.

  6. If unable to determine whether an applicant is entitled to a U.S. Residency Certification based on IRM procedures, forward the case to Headquarters (HQ) through the Planning and Analysis (P&A) staff. The applicant or taxpayer must be notified via phone or by issuance of the appropriate letter.

    1. Place the case in 702 status.

    2. Enter in remarks, "Case sent to HQ, TP notified" and an explanation why the case was sent to HQ.

  7. Generally, processing time limits are specified in IRM 3.30.123, Processing Timeliness: Cycles, Criteria and Critical Dates. For additional guidance, see the instructions for correspondence.

Form 8802, Application for United States Residency Certification

  1. Form 8802 is used to request certification of United States Residency for purposes of claiming benefits under an income tax treaty or Value Added Tax (VAT) exemption. Many U.S. treaty partners require the IRS to certify that a person claiming treaty benefits - in that foreign country - is a resident of the United States for federal tax purposes. The IRS provides this residency certification on Form 6166, a letter of U.S. residency certification.

    Note:

    Certifications issued for VAT purposes certify certain matters in relation to U.S. federal income tax status and not that the applicant meets any other requirement for a Value Added Tax (VAT) exemption.

  2. A U.S. Residency Certification Application, Form 8802, must be submitted for all U.S. Residency Certification (Form 6166) requests.

  3. The Form 8802 must be completed (see list of general requirements in 4 below), signed, dated and include all required supporting statements and/or documentation before the application can be processed. An application submitted without the date of the signature indicated may be accepted for review if all other required information is included.

  4. Form 8802 generally requires the following information be included on the form. For specific entity application requirements, see IRM 21.8.4.7.12, Applicant Requirements, Return and U.S. Residency Certification Information.

    • Correct User Fee

    • Applicant's Name and Taxpayer Identification Number (TIN)

    • Line 2, Applicant's Certification Address (Permanent)

    • Line 3, Mailing address

    • Line 4, Applicant's Entity Type

    • Line 5, Applicant's Filing requirements

    • Line 6, Applicant's Parent/Owner information

      Note:

      Line 6 is only required if the applicant checked "No" on Line 5. Common types of entities that are required to complete Line 6 are disregarded entity — limited liability corporation (DRE-LLC), qualified subchapter S subsidiary (QSSS), minor children, subsidiary, sole proprietor, Financial Asset Securitization Investment Trust (FASIT), and grantor-trust.

    • Line 7, Certification Period

    • Line 8, Verification Tax Period

    • Line 9, Certification Purpose

    • Line 10, Penalties of Perjury (POP) or Additional Info

    • Line 11, Certification Country

      Line 10 - When one of the following applies, a POP statement or additional information may be required:
      • When "no" was checked on Line 5, and an explanatory statement is missing, issue letter 3426 or letter 3444, whichever is appropriate.

      • When the calendar year entered on line 7 is the current year, send missing issue letter 3536, letter 3633, or letter 3634, whichever is appropriate.

      • When the applicant is a newly formed single member Limited Liability Corporation (LLC), established prior to 2001 or classified by default, issue letter 3635.

      • When the applicant wants to provide additional information, such as giving the third party appointee authorization to request additional certification countries - PRIOR YEAR ONLY - or additional Form 6166 for countries already indicated on the original Form 8802, enter this information in the remarks section. For example, enter in the remarks area that the third party is authorized to request additional countries.

      Reminder:

      For complete information on Penalties of Perjury Statements see Table 2 of the Form 8802 instructions

    • Form 8802 signature. See IRM 21.8.4.1.11, Who Can Sign Form 8802.

    Note:

    See IRM instructions for additional guidance on specific type entity.

  5. Issue letter 4064C if the applicant fails to provide the information required by Form 8802. See IRM 21.8.4.6.1, Processing Incoming Documents for additional information.

    Note:

    When one of the required addresses is missing, send correspondence to the address that is available.

  6. If applicant fails to provide the certification country, issue letter 3636C, or contact via phone.

  7. If the applicant fails to sign, date, or provide their title on the Form 8802, the application is not processable.

    1. The applicant must be contacted by (1) phone or (2) issue letter 4064C to request a valid signature to continue processing Form 8802. When contacting applicant by phone, see IRM 21.8.4.6.7.2, Language and Procedures for Handling Telephone calls, and IRM 21.8.4.6.7.3, Disclosure Procedure - Applicant Verification, for taxpayer authentication guidelines.

      Note:

      Management must make arrangements to have Form 8802 associated with letter 4062C.

    2. When contacting the applicant by phone, inform the taxpayer or applicant that the form received by the IRS can be faxed back. When the completed form is faxed back to the IRS it must contain a signature, date, and title of the person signing, if appropriate. See IRM 11.3.1.11, Facsimile Transmission of Tax Information, for detailed instructions on faxing.

    3. After completing the above steps and the application has been entered, place the case in 702 status while awaiting the applicant's signature.

  8. The information listed in IRM 21.8.4.1.10 (4) above is not required by law; however, the IRS cannot issue certification if the information is not provided on Form 8802.

    1. If all the information is provided and the applicant qualifies, issue Form 6166.

    2. If the applicant fails to provide the required information, do not issue Form 6166.

  9. Applicants may authorize a third party appointee to request certification for multiple tax years on behalf of the applicant on Form 8802, Form 8821, or Form 2848.

Who Can Sign Form 8802?

  1. Form 8802 must be signed and dated by the applicant.

  2. Form 8802 should also include the name and title of the signer.

  3. The chart below indicates who has the authority to sign Form 8802.

    IF the applicant is… THEN the individual with authority to sign Form 8802 is…
    A Nominee The individual or entity the nominee represents or any person duly authorized to act on behalf of the Individual or the entity the Nominee represents.
    Individual Retirement Arrangement /Account (IRA) The trustee.
    An Individual The individual.
    Husband and wife Both the husband and wife.
    A Partnership Any partner or partners duly authorized to act for the partnership (general partner or tax matters partner); the partner must certify that he/she has such authority.
    Disregarded Entity (DRE) DRE- Limited Partnership (LP) The owner of the DRE or any person duly authorized to act on behalf of the owner.
    DRE- Limited Liability Partnership (LLP) The owner of the DRE or any person duly authorized to act on behalf of the owner.
    DRE- Limited Liability Limited Partnership (LLLP) The owner of the DRE or any person duly authorized to act on behalf of the owner.
    DRE-LLC The owner of the DRE or any person duly authorized to act on behalf of the owner.
    An S Corporation Any corporate officer, e.g., president, vice-president, treasurer, chief accounting officer, etc., duly authorized by the corporation to bind the corporation in accordance with applicable state law.
    A Trust/Common Trust Fund/Grantor Trust/Simple Trust The fiduciary (trustee, executor, administrator, receiver, or guardian).

    Note:

    If the trust is a grantor trust, a grantor may sign with respect to that grantor’s portion of the trust that the grantor is treated as owning (the whole trust, where the grantor is treated as the owner of the whole trust).

    An Estate The personal representative (executor, executrix, administrator, or administratrix).
    A Corporation Any corporate officer, e.g., president, vice-president, treasurer, chief accounting officer, etc., duly authorized by the corporation to bind the corporation in accordance with applicable state law.
    An Employee Benefit Plan/Trust Any organization officer, e.g., president, vice-president, treasurer, chief accounting officer, etc., duly authorized by the Plan or Trust to bind the Plan or Trust in accordance with applicable state law.
    An Exempt Organization Any organization officer, e.g., president, vice-president, treasurer, chief accounting officer, etc., duly authorized by the organization to bind the organization in accordance with applicable state law.
    A partnership under an IRC § 761(a) election Any partner or partners duly authorized to act for the partnership, the partner must certify that he/she has such authority.
    A Financial Asset Securitization Investment Trust (FASIT) (Effective January 1, 2005, the special rules for FASITs were repealed. However, the special rules still apply to any FASIT in existence on October 22, 2004, to the extent that regular interests issued by the FASIT before that date continue to remain outstanding in accordance with the original issuance.) Any corporate officer, e.g., president, vice-president, treasurer, chief accounting officer etc., duly authorized by the corporation to bind the owner corporation in accordance with applicable state law.
    A governmental organization An official of the governmental organization, who has authority in the course of his or her official duties, to bind the organization.

    Note:

    The IRM 11.3.2.4.5, Government Agencies, states that returns and return information of a federal, state, or local government agency may be disclosed to any person legally authorized to act for such agency. Generally, verification that the requestor is a governmental official, such as a Director of Taxation or Personnel, is sufficient to indicate entitlement to returns and return information. The applications must be:

    1. Made in writing

    2. Submitted on the government agency's letterhead

    3. Signed by a government official, such as, but not limited to, a Director of Taxation or Personnel

  4. If the form is signed by an authorized representative, there must be evidence of the authorization (e.g., Form 2848 or similar power of attorney must be attached to the file). Applicants that would like to authorize a recognized individual to sign the Form 8802, thereby representing them before the IRS, must grant the individual Power of Attorney (POA). A power of attorney is written authorization for the individual to act on behalf of the applicant in tax matters.

    Note:

    The person executing the authorization must specifically authorize the recognized individual to sign the Form 8802 or tax information documents. Applicants may only authorize those individuals who are recognized to practice before the IRS. However, if the Form 2848 is attached to the Form 8802, and the Form 8802 is signed by the POA, in most cases the taxpayer intended to provide specific authority to the POA to sign the Form 8802. To avoid creating a hardship for the taxpayer that intended to have the POA sign the Form 8802, but failed to include the proper authorization statement on Form 2848, contact the taxpayer to provide the proper signature authorization.

  5. Practice before the IRS covers all matters relating to any of the following:

    1. Communicating with the IRS for an applicant regarding the rights, privileges, or liabilities of the applicant under laws and regulations administered by the IRS.

    2. Representing an applicant at conferences, hearings or meetings with the IRS.

    3. Preparing and filing necessary documents with the IRS on behalf of an applicant.

  6. Before an individual can practice before the IRS, he or she must file a written declaration with the IRS stating that he or she is authorized (by the applicant) and qualified (a recognized individual) to represent a particular applicant. Part II of Form 2848 is a declaration that can be used for this purpose. The following is a list of individuals who are recognized to practice before the IRS, and who can be authorized to apply for certification on behalf of a U.S. resident:

    1. An Attorney – any attorney in good standing of the bar of the highest court of any state, possession, territory, commonwealth, or the District of Columbia may practice before the IRS.

    2. A Certified Public Accountant (CPA)- any CPA in good standing with the IRS and qualified to practice as a CPA in any state, possession, territory, commonwealth, or the District of Columbia may practice before the IRS.

    3. An Enrolled Agent - any enrolled agent in active status may practice before the IRS.

    4. An Un-enrolled Individual – an individual who, due to their special relationship with the applicant, can represent that specific applicant. See IRM 21.8.4.1.11 (7), Who Can Sign Form 8802?.

  7. An Un-enrolled Individual – the following individuals, due to their special relationship with the applicant, may represent that specific applicant. However, that individual must provide satisfactory identification and, except in the case of the individual described in a) below, proof of the individual's authority to represent the applicant.

    1. An Individual – an individual may represent himself or herself before the IRS without having to file a written declaration of qualification and authority.

    2. A family member – an individual may represent members of his or her immediate family. Immediate family means a spouse, child, parent, or sibling of the individual.

    3. An officer – a bona fide officer of a corporation (including a parent, subsidiary or other affiliated corporation), association or organized group can represent the corporation, association, or organized group. An officer of a governmental organization with authority, in the course of his or her official duties, to bind the organization.

    4. A partner – a general partner can represent the partnership before the IRS.

    5. An employee - a regular full time employee can represent his or her employer.

    6. A fiduciary – (trustee, executor, administrator, receiver, or guardian) stands in the position of an applicant and acts as the applicant, not as a representative of the applicant.

  8. A power of attorney is generally submitted to the IRS on Form 2848. However, the IRS may also accept a power of attorney submitted in a different format. A power of attorney not submitted on Form 2848 may be accepted only when it includes all of the information identified below:

    1. The applicant's name and mailing address

    2. The applicant's Social Security Number (SSN) and/or Employer Identification Number (EIN)

    3. The employee plan number, when applicable

    4. The types of tax involved

    5. The federal tax return form

    6. The specific years or periods involved

    7. For estate tax matters, the decedent's date of death

    8. A clear expression of the applicant's intentions concerning the scope of authority granted to the recognized representative

    9. The applicant’s signature and date

  9. Powers of attorney must have a Declaration of Representation attached. The Declaration must include the statements listed in Part II of the Form 2848. In addition to the required statements, the Declaration must be signed, dated, and contain the designation under which the representative is authorized to practice before the IRS.

  10. The authorized representative is the only person, other than the applicant, duly authorized to represent the applicant, unless the authorization specifically states the person may designate other authorized representatives.

Three-Year Procedure
  1. Certain applicants may submit a Form 8802 that covers a three-year period. If the applicant checks the box for Line 4d (Estate), Line 4g (Employee Benefit Plan/Trust), or Line 4h (Exempt Organization), then it does not have to provide an original signature on Form 8802 every year. An applicant may only use this procedure if there are no material changes of fact (including name or permanent address).

  2. Year 1 - The third party designee must submit a complete Form 8802 signed and dated by the applicant along with all other required documentation based on the applicant's entity type, as well as Form 8821 (or other tax information disclosure authorization statement e.g., Form 2848, Power of Attorney and Declaration of Representative) covering a period of up to three years. The applicant's penalties of perjury statement on Line 10 of Form 8802 must include a statement that the applicant will continue to be a resident throughout year one and will continue through years two and three.

  3. Year 2 - The third party designee will complete a new Form 8802 (which need not be signed) and attach a copy of the signed Form 8802 submitted in year one (including the accompanying documentation and tax information disclosure authorization) along with the appropriate user fee.

  4. Year 3 - Follow year two procedures.

Current Year Certification Applications

  1. A Form 8802 requesting certification for the current year is required to have a statement either in box 10, or as a separate attachment to the Form 8802. The statement must state that the applicant is a U.S. resident for tax purposes and will continue to be throughout the current year (the year should be specified). If the applicant makes the statement in box 10, but there is missing information, such as the TIN, and the missing information can be identified on the Form 8802, accept the statement. The Form 8802 is signed under penalties of perjury. This allows us to accept all the information on the Form 8802. Do not delay processing the application when there is sufficient information to establish the applicant is a U.S. resident for tax purposes.

    Caution:

    When the Declaration statement is submitted separately from the Form 8802, it must be submitted under penalties of perjury and contain a valid signature, title of signer, and date. The penalties of perjury statement does not have to be in a particular format. For example, the statement may state it is signed under penalties of perjury, or it could be identified as a penalties of perjury statement, or a perjury statement.

  2. Applicants requesting a current year certification can submit Form 8802 as early as December 1st of the prior year. However, early submissions of current year applications that are received prior to December 1st of the prior year must be returned.

    Caution:

    Extreme care must be taken to ensure that only the material relative to the taxpayer(s) to whom the correspondence is addressed is enclosed in the envelope. See IRM 21.3.3.4.25, Breaches of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors.

  3. When the prior year return has not been filed and isn’t yet required to be filed, the statement must address the applicant's residency status in the prior year. Refer to the table in paragraph 4 below.

    Note:

    This statement is required of all applicants in this situation. In some instances, the applicant will not have been a resident for the prior year and therefore, will only attest to its residency status in the current year.

  4. The chart below lists the statements, by applicant type, that must be made under penalties of perjury when the Form 8802 is for a current year residency certification.

    Note:

    VAT certifications can be issued for the current year. A VAT certification requires a similar statement plus an additional statement that the business activity remains the same.

    IF the applicant is… THEN the Form 8802 penalties of perjury statement must include…
    A Nominee A statement from the individual or entity for whom the nominee is acting stating the Individual/entity name, TIN, is a U.S. resident and will continue to be throughout the current tax year.
    An Individual Individual’s Name, TIN, is a U.S. resident and will continue to be throughout the current tax year.
    An individual claiming treaty benefits for teaching or research activities for countries other than Japan Countries other than Japan: Individual’s Name, TIN, was a U.S. resident within the meaning of Article [X] of the U.S.-[country] treaty immediately before entering [country]. The assignment began on [date] and ends on [date]. Article [#] of the U.S.-[country] treaty provides a [2 or 3] year exemption from income tax.
    An individual claiming treaty benefits for teaching or research activities for Japan Individual’s Name, TIN, is (and will continue to be) a U.S. resident within the meaning of Article 4(1) of the U.S.-Japan treaty. The assignment began on [date] and ends on [date]. Article 20 of the U.S.-Japan treaty provides a 2 year exemption from income tax.
    An Individual Retirement Account/Arrangement (IRA) A statement from the trustee indicating that the IRA Name, IRA Account number, is a resident and will continue to be throughout the current tax year.
    A Partnership A statement from each partner for which certification is requested stating: Partner’s Name, TIN, is a U.S. resident and will continue to be throughout the current tax year

    AND

    A statement from a general partner stating: Partnership Name, TIN, has filed its required return and the entity classification has not changed since the return was filed.
    An S Corporation A statement from each shareholder for which certification is requested stating: Shareholder’s Name, TIN , is a U.S. resident and will continue to be throughout the current tax year.

    AND

    A statement from an officer of the corporation with the authority to legally bind the corporation stating: S Corporation Name, TIN, has filed its required return and the entity classification has not changed since the return was filed.
    A Common Trust Fund/Grantor Trust/Simple Trust A statement from each participant / owner / beneficiary stating: Name, TIN, is a U.S. resident and will continue to be throughout the current tax year. Note: When the participant, owner, beneficiary, is other than an individual, use the statement that corresponds to the entity type

    AND

    A statement from the trustee stating: Trust Name, TIN, has filed its required return and the entity classification has not changed since the return was filed.
    All Other Trusts A statement from the trustee stating: Trust Name, TIN, is a U.S. resident and will continue to be throughout the current tax year.
    An Estate A statement from the personal representative stating: Estate Name, TIN, is a U.S. resident and will continue to be throughout the current tax year.
    A Corporation A statement from an officer of the corporation with the authority to legally bind the corporation stating: Corporation Name, TIN, is a U.S. resident and will continue to be throughout the current tax year.
    An Employee Benefit Plan/Trust A statement from an officer with the authority to legally bind the organization stating: Plan/trust, TIN , is a U.S. resident and will continue to be throughout the current tax year.
    An Exempt Organization A statement from an officer with the authority to legally bind the organization stating: Organization, TIN, is a U.S. resident and will continue to be throughout the current tax year.
    A Single-Member LLC or other disregarded entity A statement from an officer/representative with the authority to legally bind the single owner organization stating: This certifies that (i) Disregarded entity owner, TIN, trading as (XXXX), is a single-owner Limited Liability Company/Limited Partnership/General Partnership that is treated as a disregarded entity for United States income tax purposes, (ii) that the (corporation, partnership, individual, etc.,) is the single owner of the (disregarded entity) and, (iii) as such, the corporation, partnership, individual, etc., is required to take into account all of the income, gain, losses, deductions, and credits against tax of the disregarded entity on its/his/her U.S. federal income tax or information return (corporation, partnership, individual, etc.). A single owner of the disregarded entity is a U.S. resident and will continue to be throughout the current tax year. This certification is given under penalties of perjury and, to the best of my knowledge and belief, the statements herein made are true, correct, and complete.
    A partnership under an IRC § 761(a) election A statement from each partner for which certification is requested stating: Partner’s Name, TIN, is a U.S. resident and will continue to be throughout the current tax year.

    AND

    A statement from a general partner stating: The Partnership Name , TIN, has made an election pursuant to IRC § 761. As a result, it is not required to file Form 1065, U.S. Return of Partnership Income, on an annual basis and all of its members report their respective shares of income, gain, loss, deductions, and credits on their tax returns as required. The partnership's entity classification has not changed since the filing of the partners' returns.
    A foreign partnership (including those under Treasury Regulation 1.6031(a)-1(b)) not required to file A statement from the general partner or the tax matters partner stating: Partnership Name, TIN, is not required to file Form 1065, U.S. Return of Partnership Income, under Treasury Regulation or Code section (specify i.e., §1.6031(a)1(b)) and the entity classification has not changed since the filing of the partners' returns.

    AND

    A statement from each individual partner for which certification is requested stating: Partner’s Name, TIN, is a U.S. resident and will continue to be throughout the current tax year.
    A Financial Asset Securitization Investment Trust (FASIT) (Effective January 1, 2005, the special rules for FASITs were repealed. However, the special rules still apply to any FASIT in existence on October 22, 2004, to the extent that regular interests issued by the FASIT before that date continue to remain outstanding in accordance with the original issuance.) A statement from an officer of the corporation with the authority to legally bind the corporation stating: Corporation Name, TIN, is the corporate owner of (FASIT's name, TIN), which is treated as a FASIT under IRC § 860H, as such the (corporation name) reports all of (FASIT name's) income, gains, deductions, losses, and credits on our Form 1120, U.S. Corporate Income Tax Return. The corporation is a U.S. resident and will continue to be throughout the current tax year.

Certification Overview

  1. A U.S. Residency Certification applicant (individual, partnership, corporation, trust, estate or exempt organization) is certified for the specified tax year or period as a United States resident for purposes of taxation if the IRS has evidence of the applicant:

    1. Having filed a U.S. tax return as a resident of the U.S.

    2. Having a valid extension to file a U.S. tax return and a resident of the U.S. (when applicable)

    3. Not being liable to file (income level does not exceed the filing requirement threshold, etc.) as a resident of the U.S.

    4. Being tax exempt

  2. Certifications issued based on an extension to file a U.S. tax return require the applicant to have filed his or her prior year tax return as a U.S. resident.

  3. When the applicant submits a copy of his or her tax return with the Form 8802 you must verify that it is complete, or if the return is necessary. If the return is not posted, or there is no record of its receipt, the return submitted is necessary for processing the Form 8802 and it must be complete. See chart below:

    If Then
    The return is processed and posted Issue certification, provided the applicant meets all other certification requirements.
    The return is not posted and the application is for Individual Master File (IMF) Check TXMOD, FFINQ or TRDBV for receipt of the return.
    The return is found on FFINQ or TRDBV Issue certification, provided the applicant meets all other certification requirements.
    The return is not posted and it is not found on FFINQ (IMF) or TRDBV Check the return to see if it is complete.
    The return is complete Check to see when it is due.
    If return is not yet due or was recently due Check the prior year filing for a U.S. resident tax return (Transaction Code (TC) 150 posted with Document Locator Number (DLN), Document Code (DC) 03, 05, 06, 07, 08, 09, 10, 11, 12, 16, 21, 22, 28).
    The applicant filed as a resident in the prior year Issue certification, provided the applicant meets all other certification requirements. Note in Remarks "RT received w/8802, prior year posted."
    The return is posted Discard the return filed with the application as classified waste.
    The return is incomplete Process the application as if the return was never received.
    The return has not yet posted and copy is attached Mark as possible duplicate and forward to the appropriate Submission Processing site.

    Note:

    If a return has never been processed (e.g., has not posted to another year or TIN), attach a Form 1725, Routing Slip, or local routing slip, and forward the return as received to Submission Processing.

  4. This IRM sets forth procedures to verify evidence that a U.S. Residency Certification applicant is a United States resident for tax purposes during the tax year or period identified on the Form 8802.

    1. The specific certification or application requirements can be found in the procedures for each specific entity.

    2. The Form 8802 also specifies certification requirements.

  5. The procedures for determining the type of evidence, which will be required of applicants for proof of residency, is based on the fact that U.S. residents are required by law or regulation to file specific types of income tax returns or forms. Therefore, our primary requirement for proof of residency is a fact of filing a U.S. tax return. Other forms of proof are evidence of:

    1. Not being liable to file

    2. Being tax exempt

  6. The Functions and Programs used for this process are:

    Duty Performed Function Program
    Telephones 700 8056X
    Technical Processing of Applications 710 8056X
    Clerical processing 790 8056X

Technical Issues

  1. All technical issues that cannot be resolved using the procedures in this IRM, or the Form 8802 instructions, must be referred to management. If management cannot resolve the issue, follow local procedures for referral to the Planning and Analysis (P&A) Analyst.

  2. The Planning and Analysis (P&A) Analyst will review and forward, when necessary, any issue requiring the attention of the Headquarters Analyst or Management Information Technology Service.

  3. Servicewide Electronic Research Program (SERP) feedback is used to submit issues concerning the U.S. Residency Certification Program. Follow local procedures for submitting topics.

  4. Applicants that have had their certification application denied, or according to the Form 8802 instructions, don't qualify for U.S. Residency certification, but believe they are entitled to treaty benefits under a specific treaty article, may request reconsideration and must provide:

    1. A detailed explanation as to why they are entitled to certification, and

    2. Any and all documentary evidence

  5. Any Form 8802 submitted for reconsideration must be forwarded to the P&A Analyst for forwarding to Headquarters.

  6. Form 8802 applicants who believe that they qualify for treaty benefits under a specific treaty article after being denied by both the Certification Unit and Headquarters must follow Rev. Proc. 2015-40 for requesting Competent Authority assistance. See IRM 21.8.4.7.2, Requesting Competent Authority Assistance in Determining Eligibility for Treaty Benefits.

User Fees

  1. The user fee must be validated before a Form 8802 can be processed. A single Form 8802 can be used to request multiple Forms 6166. The user fee is $85 for a single Taxpayer Identification Number (TIN), regardless of the country, tax period, or number of certifications requested.

  2. The validation process rejects any applications postmarked after November 1, 2006, if the applicant has not made any payment. However, if the application was accompanied with a partial payment or a miscalculated payment, provide the applicant an opportunity to make a complete payment without having his or her application rejected.

Forms 8802 Received From Lockbox

  1. Applicants are instructed to send all Forms 8802 postmarked November 1, 2006 or later, and accompanied with a check for the user fee, to a lockbox address. The lockbox deposits the payment and forwards the Form 8802 to the IRS.

  2. If a Form 8802 with a payment is received directly from the taxpayer, send the Form 8802 and payment to the lockbox by the next business day with a completed transmittal Form 3210. Retain the sender's copy in the unit. The lockbox deposits the payment and returns the Form 8802 to the IRS. When all of the payments are deposited and the Form 8802 validated, destroy the sender's copy of the Form 3210.

  3. When validating a Form 8802 received from the lockbox:

    • Date stamp with IRS received date.

    • If payment is attached, place in bin to return to lockbox.

    • If there is no payment, check to determine if a payment confirmation number is identified on the Form 8802. If there is neither a payment indicated by the lockbox nor a payment confirmation number, place the Form 8802 in the bin to be returned to the applicant.

      Caution:

      Extreme care must be taken to ensure that only the material relative to the taxpayer(s) to whom the correspondence is addressed is enclosed in the envelope. See IRM 21.3.3.4.25, Breaches of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors.

Form 8802 With Payment Attached

  1. Batch these forms and payments daily and send to lockbox. A fillable Form 3210 can be used. Identify the name of the applicant, the amount of the payment, and the check number on the Form 3210.

Electronic Payments — Background

  1. The IRS began accepting electronic payments on April 2, 2007. Applicants can get additional information about making electronic payments on www.irs.gov. The taxpayer should enter e-pay in the search box on the web site.

  2. The web site provides the applicant with information on making electronic payments and by clicking through the user prompts is directed to Pay.Gov where the applicant can make the payment.

  3. The applicant is prompted for the necessary information to process the electronic payment. The payment is made by either an Automated Clearing House (ACH) transfer (direct debit) or credit card.

  4. Two numbers are issued immediately after the payment is processed. The applicant can use either the Agency Tracking ID number or the Pay.Gov Tracking ID number as the confirmation number.

  5. The applicant must write the confirmation number on page 1 of Form 8802. If the payment covers more than one application, the confirmation number is written on each Form 8802.

Verifying Electronic Payment

  1. Access Pay.Gov and login using your user name and password. Your manager will supply you with a user name and password.

  2. Select the report list.

  3. Select ACH debit and enter the confirmation number from the Form 8802 and select the ACH Debit Transaction Search Query. If the payment is not located, use the Credit Card Transaction Query.

  4. Follow the procedures to validate the amount of the payment. See IRM 21.8.4.2.6, Validating Form 8802 Payment, for additional information. If you cannot verify the payment, reject the application. See IRM 21.8.4.2.1, User Fees.

Validating Form 8802 Payment

  1. The lock box contractor will notate the amount paid on the Form 8802 application ( on page 1). Applicants using pay.gov are instructed to enter their payment confirmation numbers on page 1 of Form 8802. Information on researching payment confirmation numbers can be found in IRM 21.8.4.2.5, Verifying Electronic Payment.

  2. Determine the required payment. The fee is $85.00 for a single Taxpayer Identification Number (TIN) regardless of the country, tax period, or number of certifications requested.

    Reminder:

    Effective April 1, 2012, the user fee was increased. Form 8802 applications received with a postmark dated on or after April 1, 2012 are charged a flat rate fee of $85.00 per application, regardless of the number of certificates requested. As a result of the increased user fee, the instructions for and the Form 8802 were revised.

  3. If the payment is verified, place your initials, the date verified, and the word "verified" in the upper right corner of page 1 of the Form 8802 next to the amount verified.

  4. If the payment is less than the full user fee, write the date, your initials and the amount owed on the bottom of the Form 8802.

  5. If the payment is greater than the amount of the full user fee, write your initials, the date verified and the word "verified" in the upper right corner of page 1 of the Form 8802. On the bottom of the Form 8802, write the date, your initials, the word "overpaid" and the amount overpaid.

  6. If the payment is more than two weeks older than the submission date of the Form 8802, verify the confirmation number on the Form 6166 search screen to ensure the payment was not used for another application.

Researching Payment Confirmation Numbers on USRC Database

  1. The payment tracking ID field on the Form 6166 search screen allows the user to find cases with a given ID number. This search field accepts upper and lower case alpha characters, numerics, hyphens, percentage, asterisks, and period. However, the search is not case sensitive.

  2. Check both the closed and open check boxes on the search screen when searching for the duplicate confirmation number.

  3. The "%" character is a wildcard that allows for an expanded search.

    Example:

    %010 will find every record whose confirmation number contains "010" anywhere in the value.

Recording Payments

  1. The applicant's payment must be recorded in the U.S. Certification database for each Form 8802.

  2. Input the entire confirmation number in the tracking number field on the Form 8802 input screen. For electronic payment, input the 11 digit number first, then one space followed by the 8 digit with letters in all caps; for example, 12345678911 12ABC1DE; for payment confirmation numbers from lockbox, do not enter into the remarks section, but into the tracking number field on the Form 8802 input user fee input screen by inputting the first 8 digits, one space, followed by 3 digits; for example, 12345678 011.

  3. A partial payment is recorded in the first payment field. A subsequent payment is recorded in the second payment field.

  4. If there is more than one record created to accommodate the number of certifications requested on a Form 8802, only record the payment associated with the Form 8802 on the first record.

  5. If one payment is made for multiple Forms 8802:

    1. Only record the payment with the first Form 8802 submitted by the payor in the database.

    2. Record your initials, full paid, deposit date, and the TIN of the application where the payment was recorded in the remarks section. Use abbreviations for full paid and deposit date. For example, Initials FP dep 01/01/2007 11–1111111. This remark can be copied and pasted to minimize key strokes on subsequent Form 8802 records that came in with the multiple payments.

Partial Payment

  1. If the payment is less than the required amount, a minimum of two attempts to contact the taxpayer must be made. Forms with incomplete payments are not processible.

    Note:

    Remember to give the applicant the batch or reference number and inform the applicant that this number must be written on the top of the copy of page 3 of Form 8802 when submitting the supplemental payment.

  2. Prior to making the call, review the Form 8802 to determine:

    • If a Penalties of Perjury (POP) statement is necessary for a current year application

    • If a signature and date is needed

    • The amount needed for a complete payment

    • Any other missing information that is needed to successfully process the Form 8802

    Note:

    The applicant must submit a copy of page 3 of the Form 8802 with the supplemental payment. Give the applicant the batch or reference number to write on top of page 3 of Form 8802. This is needed to associate the supplemental payment with the original partial payment.

  3. A complete review of Form 8802 is needed before the applicant is called for the additional payment. This call is intended to decrease the time needed to process the Form 8802. The data from the Form 8802 is input to the database before the call is placed to the applicant. Place the record in 702 status and update the remarks with each contact with the applicant.

    Note:

    If the record is complete, the partial payment does not stop the automated system from issuing the Form 6166 if the status is not updated.

  4. When it is necessary to contact the applicant by telephone and you are unable to reach the applicant, place the Form 8802 and attachments in the bin for the applicant to receive a follow up call. Note the date you attempted the original call on the bottom of page one of the Form 8802. Use the following abbreviations to indicate the nature of the call.

    • T = telephone

    • POP = Penalties of Perjury

    • D = date needed with signature

    • $ = additional user fee needed

    • NA = no answer

    • NI = not in

    Example:

    If a call is placed on December 15, 2014 because a penalties of perjury statement is needed, the date next to the signature is needed, and an additional $15 is needed to fully pay the user fee, but you could not reach the applicant, the notation will appear as follows:

    • 12/15/14 T (applicant's name), POP, D, $15, NA (initials)

    • If an additional $20 is needed for full payment and the applicant stated he will mail the additional payment, the notation would be

    • 12/15/14 T (applicant's name), $20, will mail check today (initials)

    Note:

    You must use your initials after the call notation.

  5. If you cannot reach the applicant or authorized representative, leave a message identifying your name, badge number, and that you are calling from the U.S. residency certification department. Do not leave any specific case or application information in your message. Use 267-941-1000 as your call back number. Make a second call attempt within two business days. Do not make second calls the same day unless a person indicates the applicant or authorized representative will be available later the same day. If so, the application may be retained for a call back later the same day.

    Note:

    In 2008, IRS issued Smart IDs to staff with a 10 digit Personal Identification Number (PID). The last seven digits of the PID serve as your badge number.

  6. Place the Form 8802 in suspense filed by the person working the file and by the next action date.

  7. Generally, make follow-up calls within two business days of the initial call. If the applicant indicates they will send in the missing information and payment, direct him or her to mail the information to the lockbox address with the Form 8802 and write the batch or reference number on the top of the Form 8802. Return the Form 8802 with the notations of both telephone calls in the validation suspense wall and note a follow-up within 10 calendar days.

  8. If you cannot contact either the applicant or the authorized representative by telephone, send a rejection letter informing the applicant we have received his or her application and we need additional payment and possibly additional information.

  9. File Form 8802 with a copy of the rejection letter on the suspense wall. File the application by tax examiner, action date (30 calendar days from the day the rejection letter was mailed) and by TIN within date.

  10. If there is no response to this request within 30 calendar days, send the abandonment letter and update the remarks, purge the application and all notations and attachments from the suspense wall and close the record on the database. Maintain partially paid applications without a response to the abandonment letter for six months from the date of the application.

No Response After Telephone Contact

  1. The applicant may send all, part, or none of the information requested in the telephone conversation. If payment is not received within ten calendar days of the telephone contact, send the form letter confirming the telephone conversation requesting missing information to the applicant.

    Note:

    Do not send this letter if the applicant has sent the full payment. Once the payment is verified, send Form 8802 for batching and processing. If there is additional information necessary, follow the appropriate sections of this IRM.

  2. Place the record in 702 status and suspend the case for 30 calendar days.

  3. If neither payment nor additional information is received from the applicant, see IRM 21.8.4.2.9, Partial Payment.

Refund of User Fee

  1. Generally, the user fee is not refundable. For example, the user fee will not be refunded if the Form 8802 is procedurally deficient and the applicant fails to submit (in a timely manner) the additional information necessary to complete processing the application. Further, do not refund the user fee if the Form 8802 is withdrawn at any time after it is received by the IRS. Likewise, if foreign claim forms are submitted after a certification request has been processed, return the foreign claims to the applicant. These forms must be submitted with a Form 8802 and a new user fee based on the new Form 8802.

    Caution:

    Extreme care must be taken to ensure that only the material relative to the taxpayer(s) to whom the correspondence is addressed is enclosed in the envelope. See IRM 21.3.3.4.25, Breaches of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors.

  2. The overpayment of a user fee is refunded when it is the result of a mathematical error or mistake. Issue the refund to the payor of the fee. In most instances, this will be the applicant. However, if the fee was paid by a custodian or an appointee for one or more applicants, return the fee to the custodian, appointee, or other entity that paid the fee.

  3. Prepare a Form 3210 identifying the applicant's name or the appropriate recipient's name and address along with the amount of the refund identified from the U.S. certification user fee.

  4. Refer the Form 3210 to the U.S. Certs Clerical Team who will notify the applicant of the overpayment and who will then send the request to the Beckley Finance Center to generate the check.

  5. The Form 3210 can be scanned and attached to an E-mail using secure messaging to ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ at the Beckley Finance Center for processing. A copy of the E-mail and memorandum is filed by notice date and stored for 12 months.

  6. If either the scanning equipment or the E-mail system is not available and is not expected to be available by the next business day, fax the memorandum to ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ at 304-254-3499. Use an approved fax cover sheet when sending this information.

Certification Issues With a Foreign Country

  1. Refer the following certification issue to the Competent Authority Office,≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ :

  2. Foreign countries' rejection of Form 6166 Certification resulting from foreign legislative changes or other new requirements including requirements for language not set forth in a standard Form 6166

    Example:

    A taxpayer requests U.S. Residency certification for a country other than one set forth in IRM 21.8.4.7.13, Specific U.S. Residency Certification Language for Specific Countries, and indicates that additional specified language is required in order for the certification to be accepted by the tax authority in that country.

    Reminder:

    Issues with hybrid entities will generally involve partnerships, Limited Liability Companies (LLC's), S-Corporations, or other entities that are considered "pass-through" or "flow-through" entities for U.S. or foreign tax law purposes.

    Example:

    A single member LLC wholly owned by a U.S. resident is treated as fiscally transparent in the U.S. but is treated as fiscally nontransparent in Country X, where it earns income subject to tax by Country X. The recipient of the entity's Form 6166 in Country X questions the substance of the form issued, including whether the proper party is named on the certification, and makes an inquiry regarding the U.S. certification process.

  3. If a foreign withholding agent refuses to accept a Form 6166 Certification provided by a U.S. taxpayer, the Treaty Assistance and Interpretation Team (TAIT) should be contacted if the refusal is based on regulations or legislation issued by the foreign country from which treaty benefits are claimed. Prior to contacting TAIT, it should be determined if the rejection is based on:

    • a foreign government's refusal to accept Form 6166

    • the need to supplement the certification with additional disclosures

    • the need to specifically modify Form 6166 in accordance with the laws of the foreign jurisdiction

  4. Consult IRM 21.8.4.7.13, Specific U.S. Residency Certification Language for Specific Countries for special requirements imposed by foreign jurisdictions prior to contacting TAIT.

Instructions for Form 8802, Application for United States Residency Certification

  1. Recommend Form 8802 and its instructions to any applicant needing technical reference material for the U.S. Residency Certification process. Information is also available on the irs.gov web site under Certification of U.S. Residency for Tax Treaty Purposes. http://www.irs.gov/Individuals/International-Taxpayers/Certification-of-U.S.-Residency-for-Tax-Treaty-Purposes

  2. Form 8802 and its instructions are available on the internet at www.irs.gov or 1-800-829-3676.

Tax Information Authorizations (TIAs)

  1. IRC § 6103(c) provides that an applicant may authorize the IRS to disclose the applicant's return or return information to any person designated by the applicant. IRC § 6103(c) distinguishes between authorizations:

    1. For purposes not directly related to a tax matter

    2. For purposes of having a third party provide information or assistance to the applicant in a tax related matter

  2. Treasury Regulation 301.6103(c)1(c) addresses requests by a taxpayer for the IRS to disclose the taxpayer's return information to a third party so that the third party can provide information or assistance relating to the taxpayer's return or transaction or other contact between the taxpayer and the IRS. This section requires that the written authorization:

    1. Be signed and dated by the applicant

    2. Contain the identity of the person(s) to whom disclosure is to be made

    3. Provide sufficient facts fundamental to the request for the information or assistance to permit the IRS to determine the nature and extent of the information or assistance requested and the returns or return information to be disclosed in order to comply with the applicant's application

  3. U.S. Residency Certification is confirmation that the applicant has filed a U.S. resident income tax return for a specific tax period and generally relates to determining the applicant's status under a treaty. When the certification authorization includes a request that a third party provide assistance to the applicant in meeting the requirements to take advantage of a treaty benefit, it falls under Treasury Regulation 301.6103(c)-1(c).

  4. When processing a U.S. Residency certification application, Form 8802, ensuring that the requestor is authorized to discuss, receive and/or request the certification is a very important factor.

  5. An applicant can authorize the IRS to disclose the applicant's return information with respect to Form 8802 in three ways:

    1. Form 8802. By completing line 3 on Form 8802, the applicant can appoint a person to whom the applicant wants the IRS to send the Certificate(s). This appointee cannot represent the applicant. This appointee cannot request Certifications for countries other than those indicated on the Form 8802, unless the applicant explicitly authorizes this on line 10 of Form 8802.

    2. Form 8821, Tax Information Authorization. The applicant can appoint a person to whom the applicant wants the IRS to send the Certificate(s) indicated on Form 8802 using Form 8821. This appointee cannot represent the applicant before the IRS, cannot sign a Form 8802 or a Form 8821 on behalf of the applicant, and cannot authorize the IRS to disclose the applicant's return information to another third party. This appointee cannot request Certifications for countries other than those indicated on the Form 8802, unless the applicant includes a statement on line 3 of Form 8821 explicitly authorizing an appointee identified on Form 8821 to request Certifications for countries other than those indicated by the appointee. Form 8821 must be signed and dated by the applicant.

    3. Form 2848, Power of Attorney and Declaration of Representative. The applicant can authorize an individual to represent the applicant before the IRS. An authorized representative can sign a Form 8802 on behalf of the applicant. However, an authorized representative cannot authorize the IRS to disclose any return information to another third party unless the applicant explicitly authorizes this on line 5 of the Form 2848. The applicant must sign and date the Form 2848, and the authorized representative must complete Part II.

  6. Use the following chart to determine who is authorized to sign Form 8802, Form 8821, or Form 2848 giving authority to request, receive, and/or discuss the certification:

    IF the applicant is… THEN the individual with authority to sign is…
    A Nominee The individual or entity the nominee represents or any person duly authorized to act on behalf of the Individual or the entity the Nominee represents.
    An Individual The individual.
    Husband and wife Both the husband and wife.
    A Partnership Any partner or partners duly authorized to act for the partnership (general partner or tax matters partner); the partner must certify that he/she has such authority.
    An S Corporation Any corporate officer, e.g., president, vice-president, treasurer, chief accounting officer, etc., duly authorized by the corporation to bind the corporation in accordance with applicable state law.
    An Individual Retirement Account/Arrangement The trustee.
    A Trust/Common Trust Fund/Grantor Trust/Simple Trust The fiduciary (trustee, executor, administrator, receiver, or guardian).
    An Estate The personal representative (executor, executrix, administrator, or administratrix).
    A Corporation Any corporate officer, e.g., president, vice-president, treasurer, chief accounting officer, etc., duly authorized by the corporation to bind the corporation in accordance with applicable state law.
    An Employee Benefit Plan/Trust Any of the organization's officers, e.g., president, vice-president, treasurer, chief accounting, etc., duly authorized by the Plan/Trust to bind the Plan/Trust in accordance with applicable state law.
    An Exempt Organization Any of the organization's officers, e.g., president, vice-president, treasurer, chief accounting officer, etc., duly authorized by the organization to bind the organization in accordance with applicable state law.
    A partnership under an IRC § 761(a) election Any partner or partners duly authorized to act for the partnership; the partner must certify that he/she has such authority.
    A FASIT Any corporate officer, e.g., president, vice-president, treasurer, chief accounting officer etc., duly authorized by the corporation to bind the owner of the corporation in accordance with applicable state law.
    A governmental organization An officer of the governmental organization with authority, in the course of his or her official duties, to bind the organization.
    A Disregarded Entity (LP/LLC/LLP/LLLP) The owner of the DRE or any person duly authorized to act on behalf of the owner.
  7. Before discussing an application, making corrections to an application, or issuing certification, first determine whether the requestor is the applicant or a third party (anyone other than the applicant).

    If Then
    The application is signed and dated by the applicant or a person having a valid POA Process it with the information provided. You may make corrections when necessary.
    The applicant signs and dates the application and asks for the certification to be mailed to a third party Process according to information provided, make corrections when necessary, no further authorization is needed.
    The application is received from a third party, someone other than for whom the certification is requested and there are issues with the application You must ensure there is a valid authorization to request, discuss, or correct the application prior to proceeding. Check Form 8802 line 3b, or an attached Form 8821, Form 2848, or like statement.
    If uncertain of a person's authorization to request, discuss or receive information Reject the certification using the letter 3427C.

    Note:

    Refer to Disclosure and Representation guidelines. See IRM 21.1.3, Operational Guidelines Overview.

  8. Only provide tax information to authorized individuals.

    Caution:

    Something as simple as revealing an applicant's address or the existence of an application is considered disclosure, a breach of confidentiality.

  9. When a third party requestor indicates a Power of Attorney (POA) or Tax Information Authorization is on file, research the Centralized Authorization File (CAF) using the Command Code CFINK and/or the Form 8821 Database in the U.S. Residency Certification program to determine if there is authorization and the extent of their authorization. See Document 6209 for Command Code Instructions.

    Caution:

    Do not discuss or disclose any applicant information to the third party until certain the requestor is authorized to receive the information.

  10. When the CC CFINK research confirms the requestor as the Power Of Attorney (POA) for the applicant needing certification, research the Form 8821 database to determine the POA needs to be entered. When confirmed:

    1. Enter the POA name and address on the 6166 database.

    2. Enter the POA name on the second name line with either ATTN. or "%" (in care of). Continue processing the application for certification.

    3. Ensure the POA's address is entered in the applicant's address field.

  11. When CC CFINK research doesn't confirm POA:

    1. Research the application, Form 8802, and/or attachments for authorization, Form 2848, Power of Attorney or Declaration of Representation, Form 8821, Tax Information Authorization, or documentation giving authorization to the requestor (e.g., Trust Agreement).

      If Then
      The Form 8802 application, Line 3b identifies a third party authorization and the form is signed and dated by the applicant Enter the information on the 8821 database, if not already in the database.
      Attachments include Form 8821 or documentation giving authorization (consent to disclose and purpose) to the requestor Input the information from this document into the 8821 database, if not already in the database.
      Attachments include Form 2848 Input the information from this document into the Form 8821 database.
      Attachments include Form 2848 and it is not specific to the certification Forward a copy to the CAF Unit in Philadelphia Accounts Management Campus (PAMC) for both international and domestic Forms 2848. Fax number is 855-772-3156.
      No attachments or the form is not signed and dated Assume requestor does not have a POA or authorization; reject the application using letter 3427C .
  12. If a signed and dated new Form 2848 or Form 8821 is received with required certification information, process as a new application.

The Certification Process

  1. The Certification Process is a consolidated effort involving three processes:

    • Payment Verification

    • Clerical

    • Tax Examination

  2. All applications for U.S. residency certification are subject to a user fee. If, at any time, it is discovered the appropriate user fee has not been paid, return the document to the clerical team. For additional information on user fee amounts see IRM 21.8.4.2.1.

Processing Incoming Documents

  1. All user fees must be verified before the Form 8802 can be processed.

  2. All documents, applications, and correspondence must be date stamped with the date of IRS receipt and processed as first in/first out, unless they meet the criteria identified for correspondence or telephonic inquiries and responses. See IRM 21.8.4.6.6, Correspondence, and IRM 21.8.4.6.7, Telephonic Inquiries and Responses.

  3. A Form 8802 with payment must be mailed. However, subsequent information submitted because the application was incomplete may be faxed.

  4. A Form 8802 must have specific application information and must be signed and dated by the applicant when the Form 8802 is used to give a third party authorization. See IRM 21.8.4.7.12, Application Requirements, Return and U.S. Residency Certification Information.

  5. Any early submission for Current Year certification received with a postmark date before December 1st must be returned to the sender. However, the application will be accepted with the previously paid user fee with a new submission on or after December 1 as long as the taxpayer includes the prior payment confirmation number on the newly submitted application.

  6. Sort all incoming documents into categories beginning with the earliest received dates, starting with the separation of:

    • Original Applications (Form 8802)

    • Original Applications with Foreign Claim forms

      Note:

      Foreign claim forms received with the applications must remain attached until the foreign claim form can be associated with the Form 6166 or a rejection letter that will be issued.

    • Additional Certification Application

    • Correspondence (paper or telephonic responses to letters, questions or request for other than certification)

  7. Once the various applications are separated from the correspondence, sort them according to the list below:

    1. IMF applications received by mail

    2. BMF applications received by mail

    3. IMF applications with foreign claim forms attached, received by mail

    4. BMF applications with foreign claim forms attached, received by mail

  8. Once the applications that were mailed are separated into IMF and BMF, perform the following:

    1. Assign a control number to each batched group.

    2. Control and account for batches at all times.

  9. Applications that state "second" or "duplicate" application or have an indication that it is not an original, may have already been processed.

    1. Check the application to determine if it is a third party application.

    2. If it is a third party application, then check for line 3b information or Form 8821 attachment. Then check the Form 8821 database to see if the appointee information is already listed. If so, do not enter it again. Ensure that the attention name and mail stops are included when listed and continue processing the Form 8802 application.

    3. When appointee information is not listed on the Form 8821 database it must be manually entered.

  10. Applications that have the Additional Request box checked do not require the re-submitting of original documentation, if a certification has been issued for the original application within the last 12 months and there has been no change to the applicant's tax information. A new user fee is required for processing an additional request submitted on a new Form 8802.

    Note:

    A name change is a change in tax information.

    1. Third party appointees cannot re-submit an application requesting additional certifications for countries for which they were not originally authorized to receive. For example, an additional application identifying Italy as the country in which certification is needed must have Italy listed on the original Form 8802, or the applicant must be authorized to receive certification for additional countries.

      Reminder:

      For detailed information regarding the Additional Request box on Form 8802, see page 4 of the Form 8802 instructions.

  11. Possible duplicate applications must be researched on the 6166 database for the original Form 8802.

    1. Choose Form 6166 from the menu bar.

    2. Choose Search.

  12. When researching possible duplicates, first determine if there is a duplicate or an additional request. Pay careful attention to the details of the application, the entity, the year of certification, the countries requested, the volume of certifications, and the type of certification when making your determination. When a determination is made, use the following chart to process the application:

    1. If Then
      The Form 8802 is a duplicate Check the status of the original.
      The original case is in an open or suspended status Associate the application with the original application. Notify the requestor via telephone, if number provided.
      No original case has been found but the case clearly indicates that it is a duplicate application The application must be given to a manager or lead to determine how it should be handled.
      The original case is in closed status, but certification was not issued

      Note:

      If an applicant was denied certification of a previously filed Form 8802, do not use the additional request box.

      Associate with original application and/or letter and notify the requestor of the status of the case via telephone, if telephone number is provided. If all information needed is provided, process the case.
      The original Form 8802 was recently processed (within the last two weeks) and certification was issued The duplicate application is classified waste and can be discarded.
      The Form 8802 is not a duplicate but a modification of the original requesting additional certifications Verify that the user fee has been paid and that any alterations or modification made to the form were made by an authorized person. See IRM 21.8.4.2.5, Verifying Electronic Payment.
      The modifications of the Form 8802 were made by a person authorized to do so Process the application in accordance with certification procedures.
  13. Correspondence must also be sorted into categories:

    • Suspense

    • Open

    • Closed

    • Inquiries

  14. Correspondence in response to a specific suspended case, and information required to process a case, must be associated with the original case and given to a Tax Examiner to be worked.

  15. Correspondence specific to an open case, must be associated with the case and given to a Tax Examiner to be worked.

  16. Correspondence specific to a closed case must be associated with the original case. If the information provided indicates that an error may have occurred or the information was needed during the processing of the original, then give the case to a Tax Examiner to initiate a new case.

    Note:

    When reprocessing a closed case, the original application received date must be circled out using red or brown pencil and enter the correspondence date as the received date.

  17. Correspondence inquiring about the certification process, or to check on the status of a case, must have a response issued.

Entering Tax Information Authorization (TIA) on Form 8821 database

  1. Once the Form 8821 input screen in the 8821 database has been accessed, enter the applicant's authorization information from the applicant's Form 8821, Form 2848, Form 8802 or clone the information, when possible.

    Note:

    When authorization information is entered from a form or document other than Form 8821, notate the form or document in the remarks section of the Form 8821 database.

  2. A Form 8821 giving authorization for both husband and wife must be entered into the 8821 database as two separate documents.

  3. Prior to entering Form 8821 information, verify that the information is not already in the database for the certification application.

    Note:

    Authorization forms that address the same tax matter revoke any previous authorization,unless the Form 8821 has box 6 checked.

  4. A Form 8821 may also be input in bulk by using the Form 8821 TIA/POA Cloning feature. This feature should be used when the TIA information is needed for two or more records.

    Note:

    All fields in the Tax Information Authorization Box are cloned.

    If Then
    The TIA information is needed for two or more records Click on the "Clone TIA" button located at the right hand corner of the TIA frame.
    A red bar appears to be cloned Cloning is activated.
    Click on the NEW button The TIA information remains the same for each new record, as long as the cloning feature is active.
    A new or different TIA needs to be input Click the "Clone TIA" button again. The cloning feature should deactivate.
    Another TIA needs to be cloned Click the "Clone TIA" button again. This feature can be turned on and off when needed by simply clicking the "Clone TIA" button.

    Note:

    Once the process to clone data from the Form 8821 database has begun, a red bar appears on the fields to be cloned.

  5. To enter the Applicant's Taxpayer Identification Number (TIN) on the Form 8821 database:

    1. Check the Social Security Number (SSN) box if the applicant's TIN is a SSN.

    2. Enter either the applicant's SSN or EIN when given and press TAB.

    3. Once the TIN has been entered, the program will require it be entered again. Enter the TIN in the small pop up box within the form. It must be placed exactly on top of the original TIN, then press ENTER. This is for verification purposes.

      If Then
      The system verifies that the TIN(s) match and the TIN is currently a part of the authorization information, a Form 8821, a Form 2848 or the Form 6166 database The program will begin to populate the Form 8821 entity fields with information from the first available record found for this TIN. THIS INFORMATION MUST BE VERIFIED.
      The generated entries on the Form 8821 database screen match the Form 8802 line 3b, Form 8821, or Form 2848 Do Not enter the information again. Continue inputting the Form 8802 application onto the Form 6166 database.
      The generated entries fail to match the application Override the generated fields by entering the information from the Form 8802, Form 2848, or Form 8821, in the required fields.
      The TIN(s) entered do not match This field will turn blue and the TIN(s) will either need to be corrected to match or the process is cancelled before the system will continue.
      The TIN is not provided Contact the requestor.
      Unable to secure the TIN information from the appointee/requestor The appointee (requestor) is not authorized to receive the applicant's certification. Issue letter 4064 or other applicable letter.
  6. Enter the applicant's Name Control.

    1. This is a four character field.

    2. See IRM 3.8.44, Campus Deposit Activity, for Name Control rules.

  7. Entering the Plan Number for all authorizations for any of the Form 5500, Annual Return/Report of Employee Benefit Plan series of returns:

    1. This is a three character field.

    2. If a plan number is not provided on Form 8821, Form 2848, similar form or Form 8802, line 4g and the authorization is for the Form 5500 series of returns, research IDRS. If the plan number cannot be determined, correspond using letter 3427 or letter 3431.

      Exception:

      When the applicant is a Government Entity, Master Trust or has a 990-T-2 filing requirement, do not correspond; enter Plan number 001.

  8. Enter the Applicant's Entity information.

    1. Enter the applicant's entity information when necessary (not previously generated);

      If Then
      Generated correctly (compare generated information with Form 8802 / Form 8821 / Form 2848) during the input of the TIN Continue processing; otherwise correct accordingly.
      The entity information is not provided Leave this section blank and contact the requestor (contact via telephone when the requestor's telephone number is provided) for a valid Form 8821.
      Unable to secure a valid Form 8821 from the requestor, no telephone number available The requestor (appointee) is not authorized to receive the applicant's information. Issue letter 3427 or other applicable letter.
  9. Enter the Tax Information Authorization Information. This information is taken from line 2 of Form 8821 or Form 2848, or Line 3b of Form 8802.

    Note:

    Verify that tax disclosure authorization information does not already exist for the applicant prior to entering the authorization information. See IRM 21.8.4.6.2 (1), Entering Tax Information Authorization (TIA) on 8821 database.

    If Then
    This section of the Form 8821 is not complete Enter the name of appointee, if available. Check the forms and the envelope for an address for the appointee for issuance of correspondence.
    Unable to secure all of the Tax Information Authorization information using the forms provided Contact the applicant (not requestor), when contact information is available.
    Unable to secure the authorization information from the applicant The appointee is not authorized to receive the applicant's information. Issue letter 3427 or other applicable letter.
  10. Verify signature, date and title if applicable. The applicant must sign and date any form that gives a third party authorization to receive the applicant's information.

    IF THEN
    The Form 8821 or the appointee information on Form 8802 is not signed and dated by the applicant or an authorized party It is not valid.

    Note:

    Research CFINK to verify the signature, and title if applicable when the Form 8802 is signed by the POA rather than the applicant.

    The Form 8821 or Form 8802 appointee information is invalid The appointee is not authorized to receive the applicant's certification; issue letter 3427.
  11. Enter the Received Date. This is the earliest received date.

    If Then
    There's no received date Enter the postmark date from the envelope.
    There's no envelope Enter the date on the folder.
    If received by fax Enter the faxed date.
  12. Enter the CAF number if it is provided on the Form 8802 and the authorization Form 2848 is not attached.

  13. Check the type of Authorized Tax Form. This must be specified and it must be for the form for which the applicant is requesting certification.

    If Then
    This information is not provided It must be secured from the applicant or the application is not valid.
    The authorized tax form information can not be secured from the applicant or requestor The appointee is not authorized to receive the applicant's information for that form and the authorization is not valid.
    Form 2848, Form 8821, similar form, or Form 8802 indicates the authorized tax form Check the appropriate tax form box.
    Form 2848, Form 8821, similar form, or Form 8802 indicates N/A, Not Required, and the application indicates tax exempt entity Verify via IDRS that the applicant is a tax exempt entity, not required to file.
    Tax Exempt status is verified Check the Form 990 box.
    Form 2848, Form 8821, similar form, or Form 8802 indicates N/A, Not Required, and the application indicates an Employee Benefit Plan Verify via IDRS that the applicant is an Employee Benefit Plan and not required to file.
    Employee Benefit Plan is verified Check the Form 5500 box.
  14. Enter the Authorized Tax Year or Years.

    1. This is a four digit field.

    2. The tax authorization year or years must be specified on either the authorization form or lines 7 and 8 of Form 8802 when the Form 8802 has the appointee information.

    3. You may enter as many prior years as provided by the authorization Form 8821.

    4. For future years, only 3 future years can be entered. That is, tax years that end no later than 3 years after the date the Form 8821 is signed by the taxpayer.

      Note:

      Check the IRS received date to determine what future years can be entered.

    5. When the Form 8821 identifies a year that is beyond the 3 years after the date the Form 8821 is signed by the taxpayer, notify the applicant that the year or years are invalid and a new Form 8821 will have to be submitted at a later date. Notate this information in the Remarks Section.

    6. When the tax years are invalid and additional information is required from the requestor or applicant, issue letter 3427 or other applicable letter.

  15. After the form has been completed, click on the SAVE button.

  16. To continue entering Form 8821, click on the New button.

  17. When complete or there is no need to continue, click on the Exit button.

  18. Once the batches of authorizations have been entered and the system has been updated, a status report needs to be printed and worked.

    Caution:

    Extreme care must be taken to ensure that only the material relative to the taxpayer(s) to whom the correspondence is addressed is enclosed in the envelope. See IRM 21.3.3.4.25, Breaches of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors.

Entering Form 8802, Application for U.S. Residency Certification

  1. The information on the certification application must be entered in the Form 6166 database.

  2. Once the screen containing the Form 6166 has been reached, begin entering the data.

  3. The Cloning feature is available on the 6166 database. Use this feature when the application information is needed for two or more records or when the Additional application box is checked. The following are cloning restrictions:

    • All fields in the Case Information Box

    • All fields in the Tax Information Authorization Box

    • The Newly Formed Box

    • VAT Certification Box

    • Current Year Box

    • Penalty of Perjury Statement Box

    • Country Code

  4. Enter the Primary Applicant's Taxpayer Identification Number (TIN) from Form 8802.

    Exception:

    See (5) below for the TIN to enter for a Nominee, a FASIT, a qualified subsidiary (Q-Sub), a Single Member LLC, a Single Member LLP, a Minor Child or a Sole Proprietor applicant.

    If Then
    SSN provided Check the SSN block and enter the applicant's SSN.
    EIN is provided Enter the applicant's EIN. See Exceptions above and the instruction in (5).
    A TIN is not provided Research attachments and Integrated Data Retrieval System (IDRS) (if not a third party applicant).
    TIN located on attached documentation Enter the applicant's TIN.
    This is a third party application, and the applicant's TIN can be secured from the attached authorization Enter the applicant's TIN in the Primary TIN field.
    This is a third party application, and the applicant's TIN cannot be secured from the Form 8821 or Form 2848 Correspond using Form 8821 procedures above.
    Applicant's TIN located Enter found TIN in the Primary TIN field.
    Applicant's TIN not located The primary TIN field remains blank.
  5. Use the chart below to determine what TIN to enter in the Primary Applicant's Tax Identification Number field when the certification applicant is a Nominee, a FASIT, a Single Member LLC, a DRE-LLP, a DRE-LP, a Minor Child, a Q-Sub or a Sole Proprietor:

    If Then
    A Nominee Enter the TIN of the individual or entity the Nominee represents.
    A FASIT (financial asset securitization investment trust)/IRC § 860H Enter the TIN of the FASIT's Corporate Owner.
    A DRE-LLC, DRE-LP , DRE-LLP, or DRE-LLLP Enter the TIN of the single member owner of the limited liability company, limited partnership, limited liability partnership, or limited liability limited partnership.
    A Minor Child Enter the TIN of the person who claimed the minor child on the tax return.
    A Q-Sub (Qualified Subchapter S Subsidiary) Enter the TIN of the Subchapter S subsidiary's parent, Line 6 of Form 8802.
    A Sole Proprietor Enter the TIN used to claim the income on the individual's tax return.
  6. Enter the Secondary Tax Identification Number (TIN) field when the certification applicant is married and filed a joint return, or is a Nominee, a FASIT, a Q-Sub, a Single Member LLC, a DRE LLP, a DRE LP, a Minor Child or a Sole Proprietor.

    If Then
    TIN is a SSN Check the SSN block and enter the applicant's SSN.
    TIN is an EIN Enter the applicant's EIN.
    Nominee Enter the TIN of the Nominee.
    FASIT Enter the TIN of the FASIT.
    Q-Sub Enter the TIN of the Qualified Subchapter- S (Q-Sub) in this field.
    LLC, LP, LLP, or LLLP- DRE Enter the TIN of the Disregarded Entity (DRE) limited liability company or limited liability partnership.
    Minor Child Enter the TIN of the minor child.

    Note:

    You must also check Non-Spouse indicator when using the child's TIN on the certification.

    Sole Proprietor Enter the TIN of the business.
    Any other Disregarded Entity Enter the TIN of the disregarded entity.
  7. Non-spouse Indicator box must be checked when the Primary and Secondary TIN(s) are both SSNs. However, the Primary TIN is used for verification purposes ONLY and the Secondary TIN is printed on the certification.

  8. Enter the applicant's entity information from the applicant box on Form 8802. See exceptions in the IF/Then box below.

    • Name

      Reminder:

      Do not issue joint certification if only one of the applicants is mentioned in the penalties of perjury statement, or only one of the applicants signs the application. For example a married filing joint couple applies using both names, but only one spouse is mentioned in the perjury statement, issue the certification in the name of the spouse mentioned in the perjury statement.

    • Street Address

      Note:

      Currently, this is the address where the certifications or correspondence are being mailed.

    • City, State and ZIP

    • Phone number (when applicable)

    Exception:

    If Then
    IRA Enter the Account name (this is generally the IRA holder's name).
    Minor Child Enter the name of the person who claimed the minor child on the tax return from Form 8802.
  9. Enter the applicant's Name Control.

    1. This is a four character field.

    2. See IRM 3.8.44, Campus Deposit Activity, for information on determining the Name Control.

  10. The Name Control is the applicant's unless the applicant is a Nominee, a FASIT, a Q-Sub, a Single Member LLC, a DRE LLP, a DRE LLLP, a Minor Child or a Sole Proprietor.

    If Then
    A Nominee Enter the name control of the individual or entity that the nominee represents. See the nominee's required attachments.
    A FASIT/IRC § 860H Enter the name control of the FASIT's corporate parent from Line 6 of the Form 8802.
    A DRE LLC, LP, LLP, or LLLP Enter name control of the owner of the limited liability company, the limited partnership, the limited liability partnership or the limited liability limited partnership from Line 6 of the Form 8802.
    A Minor Child Enter the name control of the person who claimed the minor child on the tax return from Line 6 of the Form 8802.
    A Q-Sub Enter name control of the subchapter S subsidiary's parent from Line 6 of the Form 8802.
    A Sole Proprietor Enter the name control of the person who claimed the business income on the individual tax return from Line 6 of the Form 8802.
  11. Enter the Certification Tax Year Residence from Form 8802 if different from the address entered in applicant entity field. This field should be the address where the applicant had a Substantial Presence.

    Note:

    This should be the address of residence for the year in which certification is requested.

    This address should include the:

    • Street Address

    • City, State and ZIP

  12. Enter the Certified Name Line, when applicable.

    1. This line is automatically generated from the entry in the applicant information field.

    2. This field will not be entered, unless there is an entry on Line 1 of the Form 8802.

      Caution:

      Use this field if the requested name on the certification has more than 35 characters or the application is for a FASIT, Nominee, LLC, LLLP, LLP, LP, minor child, Q-Sub, sole proprietor , and the entity requesting the certification (the parent entity, the single member owner, etc.) is other than the entity being certified.

    3. This line should be the name just as it appears on Line 1 of Form 8802, or applicant name if line 1 is blank.

  13. Enter the Year/Period of Certification, Line 7, Form 8802.

    1. This is the year that will be printed on the certification. When this year is the current year, then the applicant is required to provide a statement attesting to their current residency status.

      Note:

      When this statement is submitted separately from the Form 8802, it must be made under penalties of perjury.

    2. This is a four character field.

    3. This is a required field.

    4. Enter the year specified on the certification application, Form 8802, line 7.

    5. You must enter a separate record for each year identified on Line 7.

      Reminder:

      Use the cloning feature.

    6. When the year is not specified, you must correspond.

  14. Enter the Tax Period Ending from box 8, Form 8802.

    1. Research this tax period when verifying the fact of filing.

    2. This is a six character field, which indicates the four digit year and two digit month.

    3. This field is required and can be found on Form 8802, line 8.

    4. When the certification application is for a prior year in which a return was due, the tax period should correspond to the year of certification.

    5. When the tax period requested is a tax period for which a tax return is not yet due, enter the tax year for the tax return currently required to be filed, based on the IRS received date of the Form 8802. See the chart below for factors that must be considered when determining the return due date.

      Refer to IRS Processing Codes and Information Document 6209 for Forms not listed
      FORMS 1065 1120 1040 990 990–T (IRC § 401 and §408) 5500 series 1120C
      1041 990EZ
      990PF
      5227 990–T (IRC § 501 (c))
      If the Year ends in month Form due in 2.5 Months Form due in 4 Months Form due in 3.5 Months Form due in 4.5 Months Form due in 3.5 Months Form due in 7 Months Form due in 8.5 Months
      01 4/15 5/15 5/15 6/15 5/15 8/31 10/15
      02 5/15 6/15 6/15 7/15 6/15 9/30 11/15
      03 6/15 7/15 7/15 8/15 7/15 10/31 12/15
      04 7/15 8/15 8/15 9/15 8/15 11/30 01/15
      05 8/15 9/15 9/15 10/15 9/15 12/31 02/15
      06 9/15 9/15 10/15 11/15 10/15 01/31 03/15
      07 10/15 11/15 11/15 12/15 11/15 02/28 or 02/29 4/15
      08 11/15 12/15 12/15 01/15 12/15 03/31 5/15
      09 12/15 01/15 01/15 02/15 01/15 04/30 6/15
      10 01/15 02/15 02/15 03/15 02/15 05/31 7/15
      11 02/15 03/15 03/15 4/15 03/15 06/30 8/15
      12 03/15 4/15 4/15 5/15 04/15 07/31 9/15

    Note:

    If the due date falls on a Saturday, Sunday, or legal holiday, the due dates will fall on the next day that is not a Saturday, Sunday, or holiday.

  15. Enter the Form Number from line 5 or line 6 of Form 8802.

    1. This is the type of Form that the applicant or its parent files annually.

    2. Enter the form number as it is submitted on application.

      IF THEN
      A form number has not been given Check the type of entity checked on Form 8802.
      There is no entity checked in the Entity Type section of the Form 8802 Research for the Form type.

      Exception:

      Third Party applications require correspondence.

  16. When certification is for a Q-Sub and the Q-Sub election has been verified, check the QSSS verified box.

  17. Check the Newly Formed Box when the applicant is a newly established partnership, Common Trust, Grantor Trust, Simple Trust or S Corporation that has not been required to file a return.

  18. Check the VAT Certification box when the Form 8802, certification application, indicates that the application is for Value Added Tax. The North American Industry Classification System (NAICS) Code must be entered when provided.

  19. Check the Current Year Box when the applicant is requesting a current year certification.

  20. Check the Perjury Statement Box when the applicant is required to provide, and has included, a declaration statement in box 10 of Form 8802 or a separate statement.

    Note:

    The statement must be signed under penalties of perjury when the Form 8802 is signed by someone other than the taxpayer/applicant or when submitted separately from Form 8802.

    If and Then
    Certification application is for a newly formed LLC, Current Year LLC, or one established by default There's a declaration statement on Form 8802 or attached Check the box.
    Certification application is for a newly formed LLC, Current year LLC, or one established by default There's no declaration statement on Form 8802 or attached Leave blank.
    Certification application is for a current year There's a declaration statement on Form 8802 or attached Check the box.
    Certification application is for a current year There's no declaration statement on line 10 of Form 8802 or attached Leave blank.
    Certification application is for a current year Partnership, S Corp., Common Trust Fund, FASIT/IRC § 860H, Grantor Trust, or Simple Trust There's a declaration statement on Form 8802 or attached for the entity Check the box.
    Certification application is for a current year Partnership, S Corp., Common Trust Fund, FASIT/IRC § 860H, Grantor Trust, or Simple Trust No declaration statement on Form 8802 or attached for the entity Leave blank.
    1. The LLC penalties of perjury statement is a declaration under penalties of perjury that the parent organization reports all of the LLC income on its return.

    2. The FASIT/860H, Partnership, S Corp., Grantor Trust, or Common Trust Fund penalties of perjury statement is a declaration under penalties of perjury that the organization's tax classification hasn't changed since the filing of its last required return. These penalties of perjury statements are submitted along with penalties of perjury statements from the partners, shareholders, trust owners, trust beneficiaries, and trust participants that they are U.S. residents and will remain so throughout the current tax year.

    3. Use the following chart to determine who should sign the penalties of perjury statement when it is not provided on the Form 8802 or as an attachment:

      If Then
      Nominee The individual or POA with legal authority to bind the nominee applicant.
      Minor child Either parent may sign the child's name on the statement. The parent must also sign as parent of minor child.
      Deceased individual Executor or administrator of the estate.
      Partnership A partner duly authorized under state law to act for the partnership. This may not always be the Tax Matters Partner (TMP).
      Corporation, Q-Sub, FASIT Corporate officer or the POA with legal authority to bind the corporation.
      Trust , IRA Trustee or the POA.
      Estate Executor, administrator of the estate, or the fiduciary of the estate.
      Exempt organization Corporate officer or the organization's POA that has legal authority to bind the organization.
      Employee benefit plan Corporate officer or the organization's POA that has legal authority to bind the Trust or plan.
      Disregarded Entities An individual that has legal authority to bind the DRE owner.
  21. Enter the Country Code applicable to the country identified on the Form 8802.

    1. This is a required field.

    2. This is the code established for the country for which the applicant is requesting certification.

    3. See the list of valid country codes.

    4. If the country is not identified on the application, contact the applicant by phone or letter.

    5. If the country information appears to be altered, verify that the person who altered the application is authorized to do so.

      Note:

      Either applications or additional requests submitted by a third party should indicate that the third party has a POA or the original Form 8802 must have authorized the third party to receive certification for countries not listed.

  22. Enter the specific Number of certifications requested for each country, see Form 8802.

    1. This is a required field. If this information is not provided, correspond using letter 3636C.

    2. When it appears that these numbers have been altered, verify that the additional request box is checked. When the alterations involve additional countries, verify that the requestor was authorized in box 10 of Form 8802 or by an attached statement to make the changes. Continue to process. See IRM 21.8.4.6.2, Entering Taxpayer Information Authorization (TIA) on Form 8821 database.

    3. When a third party is not authorized to request additional certifications (no POA, no statement in box 10 or attached, or the applicant did not initial changes to alter the form), reject the application.

      Note:

      If the current Form 8802 does not indicate authorization for third party changes, check to see if an original form is attached authorizing the changes prior to rejecting the form due to lack of authorization.

  23. Enter the IRS Received Date.

    1. This must be the earliest IRS received date stamped on the Form 8802.

      Note:

      When the Form 8802 is an early submission for a current year certification, the received date must not be prior to December 1. If so, return the application to the sender. Extreme care must be taken to ensure that only the material relative to the taxpayer(s) to whom the correspondence is addressed is enclosed in the envelope. See IRM 21.3.3.4.25, Breaches of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors.

    2. This is a required field.

    3. When there is no date stamped, enter the postmarked date from the envelope.

    4. When there is no envelope, enter the date on the folder.

    5. When the Form 8802 is faxed, enter the fax receipt date.

  24. Enter the Inquiry Date

    1. This should be the date the requestor made the application for certification; it should be taken from the signature line. If the date on the signature line is after the received date, input the earliest IRS stamped received date as the inquiry date.

    2. This is a required field.

  25. Enter the Correspondence Received Date.

    1. This should be the date that a correspondence or response was received.

    2. Correspondence/responses can be paper, telephonic, or electronic form.

  26. Check the reserve for paragraph override box when it is necessary to override the language in the systemically generated certifications.

  27. Enter the Employee Plan Number, line 4g of Form 8802, when applicable.

    1. This field is only used when the certification application is for Form 5500 series.

    2. This field is a three character field.

    3. If a plan number is not provided, use IDRS to research for the number or correspond for the number.

      Exception:

      Government Entities, Master Trust and Form 990-T-2 applicants, enter Plan Number 001.

  28. Check the Dual Status Box if the application is for a dual status resident.

    1. This is indicated on Line 4a of Form 8802.

    2. Enter the date on which U.S. Residency began and the date it ended (this date cannot be later than the current date) in the certification year.

      Note:

      Use this field to enter the date on which U.S. Residency began and ended in the certification year both for dual status residents and for partial year Form 2555 filers.

  29. Check the Tax Information Authorization box. See appointee information on line 3b, Form 8802.

    Reminder:

    If this box is checked the Certification(s) will be mailed to the Third Party address automatically.

    1. If the TIA information is not on the Form 8802, check to see if Form 8821 or Form 2848 is attached.

    2. Use this box only if the application is to be sent to the third party.

    3. Click, "Press here to select TIA from the list of validated TIA's" .

    4. Select the TIA that matches the requestor for this certification.

    5. When the TIA (requestor) is not listed, click Trustee. This generates status code 609 indicating that the requestor may not have authorization to receive the applicant's tax information, ensure TIA information is present in the entity section of the Form 6166 database. See IRM 21.8.4.6.4, Working Status Reports, for working status code 609.

  30. Entering Partnership/S Corporation/Common Trust Fund/Grantor Trust/Simple Trust listings. Partnerships, S Corporations, Common Trust Funds, Grantor Trust, Nominee and Simple trust certifications all require verification of the required return for the tax year for which certification is requested for each partner, shareholder, participant, owner, and beneficiary listed on the list provided with the application.

    1. A requestor (this includes partners within the partnership) of a partnership certification must have written authorization from each partner/shareholder/participant/owner/beneficiary for which certification is requested in order to receive the certification information.

      If Then
      Application is for a current year certification Verify that current year penalties of perjury statements are attached.
      Current year penalties of perjury statements attached Check the POP box for each partner, shareholder, participant, owner, and beneficiary statement attached to the application.
      Current year penalties of perjury statement is not attached Leave the POP box blank for each partner, shareholder, participant, owner, or beneficiary whose statement is missing.
    2. When a partnership or any other type of pass-through entity is listed as a partner within the partnership, verify fact of filing and authorization of all of its partners, shareholders, participants, etc. involved in that pass-through entity and that are requesting certification. When a second tier list is not provided, but the second tier pass-through entity is listed as a partner on the original list, correspond with the taxpayer to obtain the missing information. Once received, enter the second tier partnership list in the second tier partnership list. Do not include the second tiered partnership when the list is not provided.

      Note:

      This process must continue until all partners requesting certification are identified, all partners have given authorization, and all have been added to the Partnership/associates page/listing.

  31. Enter the information on suspense cases and any other pertinent information received with the certification application in the Remarks Section.

    Example:

    The 3rd party designee is authorized to receive certification for countries not listed.

    1. Click on the Open Remarks button or use CTRL "R" ,

    2. When it is not necessary to add information to the Remarks Section, allow the field to remain blank.

  32. Click the force local box when it is necessary to keep the certifications from printing at the Centralized Print Site.

    Note:

    When printing a manual certification, a copy of the cover letter and certification must be kept with the case file.

  33. Click the foreign claim form box whenever foreign claim forms are part of the certification package.

  34. After all possible fields have been entered, review entries for accuracy, and click the Save Button.

    1. If all of the required information was entered, during the update phase of the U.S. Residency Certification program, the system begins the process of systematically verifying residency.

    2. If there is insufficient information or the system fails to find the required data to verify residency, a specific error generates on the status report and a tax examiner is required to perform additional research or issue correspondence.

  35. Once the certification application has been saved, click NEW to continue inputting certification applications..

  36. Upon completion of a batch of work and an update has been performed, a status report can be printed and worked.

Working Status Reports

  1. Once the update phase of the Certification Program is run, status reports are generated and can be printed. For instruction on printing status reports, see Lead/Manager.

  2. The Status Reports consist of all applications that are validated and ready for certification issuance (status code 099); as well as those in error, requiring additional research.

  3. Once the status report has been printed, use Form 8802, Form 8821, the Form 6166 screen and various IDRS Command Codes to research all of the cases in error (those not in status 099) when necessary.

    Note:

    For assistance with IDRS research, refer to IRM 2.3, IDRS Terminal Responses, for input instructions; Document 6209, IRS Processing Codes and Information.

  4. When working status code 609, manually research the TIA and the applicant information on IDRS.

    If Then
    TIA information found Enter the TIA information, when necessary.

    Note:

    You will also need to include the TIA information on the second name line with Attn. or c/o (in care of). Be sure to enter the TIA address in the applicant's address field.

    TIA information is not found Decline the application and return it to the requestor.
  5. See the Status Code Charts below for a list of the Pre-IDRS Status codes, an explanation and abbreviated correction guidelines. See the instructions for your specific applicant for additional correction procedures.

    Pre-IDRS Status Codes
    Code Explanation Correction
    600 Ready for IDRS research None required, override if manual verification performed.
    601 Sent for IDRS research None required, override if manual verification performed.
    605 Applicant entity not valid Verify taxpayer entity, the Name, the TIN and the Form 8802. Correct accordingly or correspond using Letter 4064C.
    608 Possible Foreign Entity Verify taxpayer residency, using Form 8802 and IDRS. If research indicates U.S. resident for the Certification year, override.
    609 Manual verification needed on TIA Research for TIA on Form 8802, Form 8821, Form 2848, or IDRS. If found, enter TIA information and override. If not located, issue letter 3427.

    Exception:

    When the tax period being researched is not present on Form 8802, Form 8821, Form 2848, or IDRS, but the certification year is, issue certifications if all other requirements are met.

    611/612 No record of this POA/TIA (6166 only) Research for TIA on Form 8802, Form 8821, Form 2848, or IDRS. If found, enter TIA information and override. If not located, issue letter 3427.
    615 Tax form type missing Verify type of tax form. If information found, enter. If not found, correspond unless the application is from applicant. If application is from applicant, then research.
    616 Invalid TIN and Tax Form combination Verify TIN and Tax Form, from application; correct accordingly. If unable to locate correct information, research IDRS if applicant is the requestor; otherwise, correspond.
    617 Form 5500 and no plan number Enter plan number from Form 8802. If unable to locate plan number, research IDRS if applicant is the requestor; otherwise, correspond.
    620 Tax Year blank or invalid Verify and correct tax year according to Form 8802 application. If not found, correspond using letter 4064C.
    621 Applicant may not be required to file (does not go to IDRS) Verify applicant's filing requirement, using Form 8802 and IDRS. If no filing requirement - Override.
    625 One or more data fields are invalid Verify data input on Form 6166 input screen.
    626 Certified year must equal tax period field, current year, or prior year Verify, then correct, override, or correspond.
    630 Multiple errors Compare information entered with Form 8802, then correct.
    633 Paragraph code does not exist Verify that you have selected all of the correct boxes, entity type, tax form filed, etc.
    635 QSSS Verified box not checked Verify via attachments to Form 8802 or IDRS that the entity is an approved Q-Sub. If unable to verify Q-Sub, correspond.
    640 No record of POP but one required Verify, using Form 8802 that POP is required. If required and on the form, correct accordingly. If not on form, correspond.

    Note:

    Before corresponding, ensure that no other information is needed.

    645 Country Code not Valid Verify the country using Form 8802; verify the code. If not listed, notify the manager.
    650 No list entered and applicant is a Partnership/S Corp./Grantor/Simple or 584 Trust Verify, using Form 8802, that the correct entity type has been entered. If so, check for attached list and enter. If list is not attached, you must correspond.
    660 The supplied NAICS code is invalid Verify entry and correct NAICS code when an error occurred, or correspond for a valid code.
  6. See the Status Code Charts below for a list of the Post-IDRS Status codes, an explanation, and abbreviated correction guidelines. Prior to working Post-IDRS status codes, using all documentation available, verify that there are no input errors, e.g., misspelling, typing errors, wrong TIN, etc. When input errors are found, correct the record. You can override codes beginning with 5,1, E and 0.

    Exception:

    Status Codes 099 and 000.

    Post-IDRS Status Codes
    Code Explanation Corrective action
    E05 Requested account not found Check input.
    002 BMF Request -Command discrepancy Input Data Indicates-BMF data; if correct, use command code (CC) BMFOL.
    012 Requested Module doesn't exist on Master File or RRR Check input, correct and re-enter.
    016 There is currently no such SSN with this validity indicator on the Master File Check SSN and re-enter if in error. If SSN is correct, resubmit the command with the reverse validity e.g., SSN followed by *.
    091 Form 1065, Partnership Applicant - no partner list Using Form 8802, verify the type of certification application and correct accordingly.
    099 Application Accepted Using Form 8802, verify the Certified Name line, generate Certification accordingly.
    101 Record not on Master File Manual Research required to verify if the required return was filed for the certification year requested. Using all documentation available and/or IDRS CC BMFOLT, verify that there are no input errors, correct accordingly. If unable to correct, correspond using letter 3444.
    103 Name control does not match IDRS name control Using Form 8802 and CC ENMOD, verify that you are working with the same entity, if so, but the name is slightly different, correct the record to agree with IDRS.
    If Then
    The name on Form 8802 matches a previous name on IDRS Certification may be issued using the prior name, provided the applicant meets all other applicant and certification requirements.
    Unable to correct using Form 8802 and ENMOD Correspond using Letter 3432.
    315 An 1120S was input but a valid 1120-01 was found on IDRS Verify on Form 8802 or IDRS is correct. Check DLN of TC150 posted. Correct, override or correspond.
    322 One of the shareholders filed Form 1040NR for Q-Sub or 1120S (6166) Primary TIN/Spousal TIN mismatch Issue Correspondence, unable to certify as S Corporation.
    360 The NAICS code supplied failed to match the NAICS on applicant's account Override the 360 to status code 000 and manually issue the VAT paragraph that indicates the applicant's representation of their NAICS. Verify that the NAICS code is a valid code.
    399 A return was filed for the application tax year, but the exempt organizational code must be manually obtained from IDRS Secure the exempt organizational code from IDRS.
    500 Possible foreign entity (Form 1120F or Form 1120FSC) - DO98 Using IDRS, verify the filing requirements and the type of return filed. If either indicates a foreign entity, issue letter 3425.
    501 No Exempt Organization (EO) status on IDRS Using all documentation available and IDRS, verify that there are no input errors. If record input correctly, use INOLE to verify EO status, then use the EO Applicant instructions to work this status code.
    502 NAICS-FLAG present but no NAICS value available on IDRS or an incorrect value was returned Using all documentation available and IDRS, verify that there are no input errors. If record input correctly and NAICS Code is required, correspond.
    505 Filing requirement not on Master File Using all documentation available and IDRS, check for exemption from filing. If exemption is verified or if applicant is a non-filer and the parent exemption is verified, override and generate certification. See applicant instructions for additional correction procedures.
    507 The input plan number did not match IDRS Using all documentation available, verify that there are no input errors. If input is correct, correspond.
    508 No tax return filed and extension date prior to current date Using all documentation available and IDRS, verify that the tax year and period is correct. If correct and no return is posted, correspond using Letter 3444 for BMF and Letter 3426 for IMF (IMF responses, if a copy of the return is provided, check FFINQ for filing).
    509 No tax return or extension on file Using all documentation available and IDRS, verify that the tax year and period is correct. If correct and no return is posted, correspond accordingly (for IMF, check FFINQ for filing).
    510 Form 2555 indicator present Using all documentation available and IDRS, verify that there are no input errors. If record input correctly, use the Individual Applicant instructions to work this status code.
    511 Form 990/Invalid EO status code; does not equal one of the following values: 01, 02, 06, 07, 11 or 12 Using all documentation available and IDRS, verify that there are no input errors. If record input correctly, manually verify EO status, then use the EO Applicant instructions to work the status code.
    512 Form 990/Invalid Subsection code; does not equal one of the following values: 01-27 Using all documentation available and IDRS, verify that there are no input errors. If record input correctly, manually verify EO status, then use the EO Applicant instructions to work this status code.
    513 Filing requirement value for Form 1120 equals 06 or 15 Using all documentation available and IDRS, verify that there are no input errors. If record input correctly, use the Corporate Applicant instructions to work this status code.
    514 Subsidiary – further research required (6166) Using all documentation available and IDRS (BMFOLT), verify that the applicant is a subsidiary (verify a posted TC514, 1120-14 filing requirement, or schedule 851), then verify using the X-ref TIN that the parent organization has filed a return which included the sub.
    515 Form 1120S Corp.- No shareholders list Manual research required. Using Form 8802, verify the type of certification application and correct accordingly. Once corrections have been made, you will need to manually override to Status Code 099.
    516 Multiple forms requested, not all filing requirements found (Form 8821) Verify information input matches information given. Check IDRS for filings.
    520 No tax return filed and VAT indicator equals 1 Using all documentation available, verify that there are no input errors and the application is for VAT. If VAT, correspond.
    555 Primary TIN/Spousal TIN mismatch Using all documentation available and IDRS (CC INOLES), verify that there are no input errors and that you have a valid SSN. Correct SSN and override to Status 099 or correspond using letter 4064C.
  7. See the Status Code Charts below for a list of the Manually Entered Status codes, an explanation and abbreviated correction guidelines:

    Manually Entered Status codes
    Code Explanation Corrective Action
    000 Case input in error such as a duplicate input situation
    or
    applicant rescinds the application
    or
    manually issues certification
    or no response from international address
    Not Correctable - No action is required by the Tax Examiner.
    199 Manual Override - Suspense Case Closed Use this override status code when No Reply from taxpayer after 30 days (domestic cases only) or taxpayer unable to provide required info.
    702 Hold in suspense Indicates tax examiner is waiting for more information.
  8. If an attempt to correct the error status has been made, but there is insufficient information to process the application, complete the following:

    1. Correspond using one of the letters in the Correspondence Chart; see IRM 21.8.4.7.9, IRS Initiated Correspondence - Guidelines.

    2. Identify the information needed using the paragraph specified for the type of tax form needing certification.

    3. Allow 30 days for a response, 60 days for applicants overseas.

    4. If the applicant responds (correspondence or phone call) with the requested information, input the response date in the correspondence received date field and continue processing.

    5. If the applicant fails to respond with the requested information within 30 days (60 days for applicants overseas) and the status of the application has not been updated since issuance of the suspense letters, the application will appear on the weekly correspondence list. Update the status of the letter or close the application as a status code 199 for domestic taxpayers - 000 for international taxpayers, no reply.

    6. Certification applications are closed as a No Reply by entering status code 199 for domestic taxpayers - 000 for international taxpayers and "no reply" in the remarks field.

      Note:

      All open correspondence that has a letter issue date and a status date older than 60 days will auto close as a No Reply.

    7. If a response is not received within the appropriate time frame, close the case as status code 199 for domestic taxpayers - 000 for international taxpayers, No Reply and issue abandonment letter.

  9. When all research has been completed, the status of the cases in error must be updated. The status can be updated to:

    • 000 - indicating termination of the case.

    • 099 - indicating a verified residency.

    • Any type of suspense letter, see IRM 21.8.4.7.9.

    • Any type of Rejection letter, see IRM 21.8.4.7.10.

  10. The status of a case can be changed from the input screen or status screen.

    1. The override options can be accessed from the status screen or from the input screen.

    2. Choose 099 or 000.

    3. Answer "YES" if you want that status or "NO" if you don't.

    4. This process must be repeated until all cases in the current batch are in status 099, 000, reject, or suspense.

  11. While in the status screen, you can complete all status changes within that batch.

    Caution:

    While moving in the batch and making changes, to return to a previous page, you must exit the status report and re-enter the batch by clicking on the drop down arrow and choosing the number you are working with again. Failure to follow this process will result in all previous changes being lost.

  12. When the status report has been worked and all cases have been updated, the batch of work will be printed and mailed by the appropriate personnel.

Printing Form 6166 Certifications, Cover Letters, and Rejection Letters

  1. Use the following procedures for accessing the print screen, which will allow for the printing of the Form 6166, Certifications, and Cover Letters.

  2. In order to print Certifications and Cover Letters:

    1. Choose Console on the menu bar.

    2. Choose "Main Print Console" (Main Console Shelf will appear).

    3. Choose the batch to print and click arrow. A drop down menu will appear.

      Note:

      Cover letters must be printed prior to Certification letters or the program will default to printing Cover letters and Certifications as selected by the check marks evident on the Printing Console screen.

    4. Printing different letters can be accomplished by adding or removing check marks in the various columns. Clicking the mouse on an empty box adds a check mark and clicking on a box with a check mark already present removes it.

    5. Make sure the correct paper is in the printer.

    6. To print Cover letters only, CLICK the Print 6166 Covers/ Print U.K. Covers icon, if applicable.

    7. To print Certifications only, CLICK the Print certifications icon, if applicable.

      Note:

      All Cover letters must be printed prior to printing certification letters. Once the Certification letters are printed, the batch is closed and the batch cannot be accessed again unless the batch is reset by the manager or the lead.

Correspondence

  1. Correspondence is all communication from an applicant or their representative, excluding tax returns, whether solicited or unsolicited. This includes:

    1. Written communications in response to IRS requests for information or data.

    2. Written communications, including annotated responses, that provide additional information or dispute IRS correspondence.

    3. A telephone call that results in a written referral (Form 4442, Inquiry Referral) or research.

  2. All correspondence, IRS initiated and Applicant Correspondence, is handled in accordance with IRM 21.3.3.1.1, Policy Statement P-21-3.

  3. Policy Statement P-21-3 (formally referred to as Action 61) was created to improve the quality and timely handling of applicant correspondence. When working replies sent in by the applicant (in response to the IRS notice or letters sent), remember that care must be taken to conform to the Policy Statement P-21-3 requirement.

    1. Respond to the applicant inquiry within 30 days.

    2. If correspondence was received through email, do not reply back by email but offer to either phone or fax the reply. Enterprise Electronic Fax (EEFax) is the most secure method of responding to a taxpayer in order to avoid any loss of Personal Identifiable Information (PII).

    3. When unable to issue a response to the applicant within the required time frame, Policy Statement P-21-3 requires an interim letter. Interim letters must be sent every thirty days until you issue the certification or determine that certification cannot be issued.

Taxpayer Advocate Service (TAS)
  1. The Taxpayer Advocate Service (TAS) is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should.

  2. Refer taxpayers to TAS (see IRM 13, Taxpayer Advocate Service) when the contact meets TAS criteria (see IRM 13.1.7, Taxpayer Advocate Service (TAS) Case Criteria) and you can’t resolve the taxpayer’s issue the same day. The definition of “same day” is within 24 hours. “Same day” cases include cases you can completely resolve in 24 hours, as well as cases in which you have taken steps within 24 hours to begin resolving the taxpayer's issue. Do not refer “same day” cases to TAS unless the taxpayer asks to be transferred to TAS and the case meets TAS criteria. Refer to IRM 13.1.7.4, Same-Day Resolution by Operations. When you refer cases to TAS, use Form 911, Request for Taxpayer Advocate Service Assistance (and Application for Taxpayer Assistance Order), and forward to TAS.

Telephonic Inquiries and Responses

  1. The certification unit handles various types of telephone calls:

    • General information

    • Application assistance

    • Application status

    • Procedure clarification

    • Correspondence clarification

    • U.S. Residency Certification problem assistance

    • Request for additional information

  2. Calls in reference to general information do not require verification of tax authorization.

  3. Calls are answered in the order received.

  4. Calls cannot be transferred to a specific individual. If the caller asks to speak to a specific individual, research the account and respond to the caller. If the caller insists, prepare a Form 4442.

  5. When a call is reduced to writing for future research or referral (Form 4442) to another person/area, then it is considered correspondence.

    1. Referrals to the U.S. Residency Certification Unit that do not meet Taxpayer Advocate Service case criteria should be processed within 10 business days.

    2. Referrals to the U.S. Residency Certification Unit that meet Taxpayer Advocate Service case criteria are processed immediately.

    3. Referrals to the U.S. Residency Certification Unit can be sent via FAX. The numbers are 267-466-1035 or 267-466-1366.

Answering The Phones
  1. The following script must be used when answering telephone calls:

    "Internal Revenue Service, U.S. Residency Certification Department, my name is _____and my ID number is _____. How can I help you?"

  2. Once the caller indicates the issue is not generic, establish if the call is in reference to the caller or someone represented by the caller. Probe, make a statement similar to the following:

    " Before I can help you, I need to ask you some questions to protect the privacy of our applicants’ accounts. Is this call in reference to you or are you calling in reference to someone else?"

  3. When the call is in reference to the caller’s own account, then proceed to the appropriate Disclosure Procedure - Applicant Verification, see IRM 21.8.4.6.7.3, Disclosure Procedure - Applicant Verification; refer to IRM 11.3.1.11, Facsimile Transmission of Tax Information, if the caller intends to fax in information.

  4. When the call is in reference to an account other than that of the caller, then proceed to the Disclosure Procedure - Third Party Verification; see IRM 21.8.4.6.7.4, Disclosure Procedure - Third Party Verification.

  5. Complete all necessary research while the caller is on the line. Do not keep the caller on hold for more than a few minutes without giving an explanation and/or apology.

Language and Procedures for Handling Telephone Calls
  1. When initiating or returning telephone calls, the following script must be used:

    "Hello my name is ______. I am calling from the Internal Revenue Service U.S. Residency Certification Department and my ID number is ______I am trying to contact ______."

  2. When it is determined that the correct person has been contacted, explain the reason for your call.

    Example:

    I'm calling because we received the application you submitted, but additional information is needed in order to continue processing it.

    Example:

    I'm returning your call.

  3. When handling telephone inquiries, sufficient questions must be asked to establish the identity of the person on the phone.

  4. Prior to revealing any specific tax information, verify the person to whom you are speaking is authorized to receive the information using the Disclosure Procedures outlined below.

  5. When the person to whom you are speaking claims to be the applicant, proceed with the appropriate disclosure procedure, Applicant Verification; see IRM 21.8.4.6.7.3, Disclosure Procedure - Applicant Verification.

  6. When the person to whom you are speaking is other than the applicant, proceed to Disclosure Procedure - Third Party Verification; see IRM 21.8.4.6.7.4, Disclosure Procedure - Third Party Verification.

Disclosure Procedure - Applicant Verification
  1. When the person with whom you speak claims to be the applicant, begin probing to ensure that you are speaking with the applicant.

  2. If the applicant is an individual, he or she must be able to provide correct responses to at least 3 of the inquiries below. If the individual is unable to correctly answer the questions, then follow the instructions in IRM 21.8.4.6.7.3 (5) below.

    1. Please provide your Social Security Number.

      Note:

      Remember to write the SSN down for reference purposes throughout the call.

    2. Please provide your complete name (also spouse’s name if joint) as it appears on your return.

    3. What is the date of birth of your spouse (if a joint return was filed)?

    4. What is your current address? (If taxpayer cannot confirm current address, but correctly responds to all of the other questions above, then ask two additional applicant authentication questions.)

    5. What is your Date of Birth? (If taxpayer fails the date of birth question, but correctly responds to any of the questions above, then ask two additional taxpayer authentication questions. Also advise the taxpayer to contact the Social Security Administration Office to correct the date of birth to avoid future problems.)

    6. What is your telephone number?

  3. If the applicant is not an individual, determine the type of entity to be discussed. Only release information to certain people in the organization or to the organization's authorized representative. Use the following questions in making these determinations:

    1. What is your name?

    2. What is the legal name of the organization?

    3. What is the organization's mailing address?

    4. What is the organization's TIN?

    5. What is your relationship (position) with the organization?

    6. Can you legally bind the company? (Ask if you do not recognize position (title) as binding officer.)

    7. Do you have a valid POA or TIA? (Ask when caller is not a representative of the company.)

    8. If a pension plan, ask for the name, TIN and address of the sponsor.

  4. Below are some different types of entities and the people who are legally able to receive their information.

    IF THEN
    A Sole Proprietor The owner can receive the information.
    A Corporation/Company The President/CEO, an Officer or individual who can legally bind the Corporation/Company can receive the information or who signed the return and is still employed in that same capacity with the same authority (may receive information for that year/period only).
    A Partnership Members of the partnership (must be a partner for the year inquiring about) can receive the information.
    An Estate Administrator, Executor or Trustee (shown on IDRS) can receive the information.
    A Trust The Trustee can receive the information.
    A Disregarded Entity The owner, depending on the ownership, can receive the information.
    An Exempt Organization An officer in the organization can receive the information.
    An Employee Plan An officer of the organization can receive the information.
  5. Only disclose information to persons who are authorized to receive it. When in doubt, do not disclose.

    IF THEN
    You initiated the call Inform the caller the questions will be issued in writing to the address on file.
    The caller initiated the call Inform the caller that "the person who is legally authorized to discuss this account should submit the questions and/or issues to the certification unit in writing."
Disclosure Procedure - Third Party Verification
  1. Always determine if the third party is authorized to receive the applicant’s information.

  2. Third party callers claiming to have tax information authorization, must provide some personal information to verify their authorization.

    • The caller's name

    • The legal name of organization the caller represents

    • The organization's mailing address

    • The organization's TIN or Centralized Authorization File (CAF) number

    • The name, address and TIN of the applicant.

  3. Once it has been determined the contact is a third party, verify that the caller is authorized to discuss the account using one of the following:

    • Form 8821

    • Form 8802

    • Form 2848

    • Form 8821 Database

    • CFINK on IDRS

  4. Verification of the individual listed on the authorization must be completed. Use the individual's name, TIN/CAF number and any other appropriate questions to authenticate the caller. See IRM 21.8.4.6.7.3, Disclosure Procedure - Applicant Verification.

  5. Upon determining that the authorization is valid, proceed with the processing of the request.

  6. If the caller is not authorized, advise the caller that the application must provide authorization in order for the Service to discuss any specific information concerning the applicant.

Incoming Calls
  1. Calls in reference to correspondence issued from the Certification Unit must be handled in accordance with the telephone procedures. See IRM 21.8.4.6.7.1, Answering the Phones.

    1. Ask the caller for the reference number that is located on the top right hand side of the notice.

    2. Using the reference number provided, retrieve the case.

    3. When complete information has been received from the caller, determine the type of assistance being requested.

    4. Once a determination has been made that will move the case to resolution, advise the caller what is required to receive certification, and to send the required information to the attention of the tax examiner handling the case.

    5. Leave in the Remarks section, the date, the person you spoke with, and the information discussed during the telephone conversation.

      Note:

      Use the Remarks Procedure when uncertain how to include remarks on the database.

Closed Case Inquiries
  1. When a call is received in reference to a closed case, inform the caller of the date that a certification or a rejection letter was issued.

  2. If the certification or rejection was printed within the last two weeks, inform the caller to wait the two weeks and call back after the two week period has ended if the certification or rejection was not received.

  3. When it has been more than two weeks, but less than 60 days, and the inventory is current:

    1. Reprint the certification.

    2. Expedite the mailing of the certification.

    3. Inform the caller of the reprinting of the certification and that it will be mailed expeditiously.

    4. Note the actions taken in the Remarks section on the database. For guidance on entering remarks, proceed to the Remarks Procedure.

  4. When it has been more than 60 days but not more than 120 days since the printing of the certification or rejection, you must notify your manager or lead and process according to their instruction. For example, if the applicant states they haven’t received the certification or have lost it and they haven’t requested another copy during this time, reprint it. If over 120 days, applicant will need to resubmit a new application.

  5. When a caller inquires about a rejection letter, provide the caller with the rejection explanation and what information is needed to qualify for certification.

  6. When an application was rejected but the caller has the information to qualify for certification, inform the caller to fax or mail all of the required information, including the original application to the Certification Unit.

    1. Explain to the caller that once all required information is received, the Service will issue the certification or correspondence requesting any additional information within 30 days from the date the requested information was received.

    2. Note the date, the name of caller and the information requested in the Remarks section on the database. For guidance on entering remarks, proceed to the Remarks Procedure.

  7. When all of the required information (including the original application) is received, process it as a new application.

Calls in Reference to Certifications Issued with Errors:
  1. When a call is received concerning a certification that was issued with errors, complete the following activities.

    1. Determine the nature of the error.

    2. Obtain a TIN/reference number for the application in question.

    3. Verify the information issued on the certification.

    4. When a discrepancy exists with what the caller states was requested and what was processed, complete further research to determine if the discrepancy was a service error.

      Example:

      The caller states that the year of certification should have been 2014, but the certification was issued for 2013; research the original application to see if the year processed for certification differs from the certification year stated on the application.

    5. Retrieve the Form 8802, if possible, and verify the caller's information.

  2. Applications that were processed incorrectly must be corrected at the time of the call.

  3. When research shows there is no discrepancy between what is included on the database and the Form 8802 submitted, then let the caller know that a new application is required.

  4. If unable to determine where the error originated, such as unable to locate the Form 8802, request substantiation for proof of the error.

    Note:

    Proof should include a copy of the original Form 8802.

  5. When the error is in the taxpayer's name, verify the name on IDRS.

    1. Names misspelled on IDRS must be either sent to Entity using Form 4442 or referred to Customer Service at 1-800-829-4933.

    2. Names misspelled on the Certification database must be corrected at the time of the call.

Filing and Retrieving Documents

  1. All U.S. Residency Certification documents must be stored in an easily retrievable manner. The documents may be kept in date order, alphabetical order, or batch order.

  2. The filed documents are to be separated into three categories:

    • Suspense

    • Closed

    • Foreign forms

  3. All correspondence must be associated with the original application in suspense prior to working the case

  4. Correspondence that has been researched, and the original application is closed, must be associated with the original application. Once associated, determine if the case needs to be reopened.

    • If the applicant correspondence responds to correspondence initiated by the U.S. Residency Certification unit, initiate a new case.

    • If the information provided indicates that an error may have occurred, or the information was needed during the processing of the original application, initiate a new case.

  5. Correspondence that requires the reopening of a case as a new case must be processed using a new received date.

    • Circle out the original application received date using red or brown pencil.

    • Stamp the new received date on the document, using the correspondence received date.

    • Enter the correspondence received date as the received date.

Who is Eligible for U.S. Residency Certification

  1. Generally, persons/entities that are statutorily required to file a return for a specific period but have not done so (i.e., are delinquent), are not eligible for U.S. Residency Certification until they do file.

Who is Not Eligible for U.S. Residency Certification

  1. Generally, persons/entities that are statutorily required to file a return for a specific period but have not done so, are not eligible for U.S. Residency Certification.

  2. Any person/entity that filed a return as a nonresident, including Form 1040-NR, U.S. Nonresident Alien Income Tax Return, Form 1040-NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens with No Dependents, Form 1120-F, U.S. Income Tax Return of a Foreign Corporation, and Form 1120FSC, U.S. Income Tax Return of a Foreign Sales Corporation, are not eligible for U.S. Residency Certification.

    Exception:

    If an individual files a Form 1040NR for the tax year but attaches a Form 1040 covering a portion of the tax year, a Form 6166 can be issued to the individual for that portion of the tax year covered by the Form 1040.

  3. Any other entity that is not liable for tax in the United States at the entity level, such as a partnership or grantor trust, to the extent the owners, partners, participants, etc., of that entity are not themselves eligible for U.S. residency certification. Accordingly, a U.S. LLC owned by a foreign corporation, trust, or estate is not eligible for certification if it is disregarded as an entity separate from its owner (DRE) or if the LLC has elected to be treated as a partnership for federal tax purposes.

Requesting Competent Authority Assistance in Determining Eligibility for Treaty Benefits

  1. Competent Authority provides assistance to any applicant that is required by treaty to seek Competent Authority assistance.

  2. Competent Authority also provides assistance to any applicant that has been declined certification but believes that they are entitled to treaty benefits under a specific treaty article, provided:

    1. The request for such assistance is made in accordance with Rev. Proc. 2015-40.

    2. It can be established that the issue requires consultation with the foreign competent authority in order to ensure consistent treatment by the United States and the applicable treaty country.

  3. The Competent Authority does not make unilateral determinations with respect to residency. Therefore, all requests for residency determination are made by mutual/bilateral agreement between the two Competent Authorities.

Tax Treaties

  1. Income tax treaties between the United States and foreign countries typically provide for either a reduction in the statutory rate of tax or an exemption from tax for certain types of income received by citizens and/or residents of the contracting countries.

  2. Many foreign countries withhold tax at the source on income flowing out of such country. If the statutory withholding rate exceeds the treaty rate of tax, one of the following methods may be used to adjust for the treaty rate of tax.

    1. The foreign country may automatically reduce the withholding rate to the treaty rate of tax in the case of income of recipients who have evidence of United States residency; or

    2. The foreign country may withhold income taxes at its statutory rates and require recipients to recover taxes paid in excess of the reduced treaty rate by filing claims for refund which include evidence that the recipient is a resident of the United States and entitled to the treaty benefits.

  3. The following chart is a list of the most current treaty countries. Use the corresponding country codes when entering the Form 8802, certification application, on the Form 6166 database:

    Treaty Countries
    Country Country's Codes
    Armenia (U.S.S.R. Treaty) AM
    Australia AS
    Austria AU
    Azerbaijan (U.S.S.R. Treaty) AJ
    Bangladesh BG
    Barbados BB
    Belarus (U.S.S.R. Treaty) BO
    Belgium BE
    Bulgaria BU
    Canada CA
    China (Peoples Republic of China - does not apply to Hong Kong) CH
    Cyprus CY
    Czech Republic EZ
    Denmark DA
    Egypt EG
    Estonia EN
    Finland FI
    France FR
    Georgia (U.S.S.R. Treaty) GG
    Germany GM
    Greece GR
    Hungary HU
    Iceland IC
    India IN
    Indonesia ( including Bali, Belitung, Flores, Moluccas, Sumatra, Timor) ID
    Ireland EI
    Israel IS
    Italy IT
    Jamaica JM
    Japan JA
    Kazakhstan KZ
    Korea, Republic of (South) KS
    Kyrgyzstan (U.S.S.R. Treaty) KG
    Latvia LG
    Lithuania LH
    Luxembourg LU
    Malta MT
    Mexico MX
    Moldova (U.S.S.R. Treaty) MD
    Morocco MO
    Netherlands NL
    New Zealand NZ
    Norway NO
    Pakistan PK
    Philippines RP
    Poland PL
    Portugal PO
    Romania RO
    Russia (Federation) RS
    Slovakia (Slovak Republic) LO
    Slovenia SI
    South Africa SF
    Spain SP
    Sri Lanka CE
    Sweden SW
    Switzerland SZ
    Tajikistan (U.S.S.R. Treaty) TI
    Thailand TH
    Trinidad and Tobago TD
    Tunisia TS
    Turkey TU
    Turkmenistan (U.S.S.R. Treaty) TX
    Ukraine UP
    United Kingdom UK
    Uzbekistan (U.S.S.R. Treaty) UZ
    Venezuela VE
  4. Additional information is available in Publication 901, U.S. Tax Treaties, or the international income tax treaty page at United States Income Tax Treaties - A to Z.

  5. For specific U.S. residency certification language for the following countries: Armenia, Azerbaijan, Belarus, Georgia, Greece, Kyrgyzstan, Moldova, Russia, Spain, Tajikistan, Turkmenistan, Uzbekistan, refer to IRM 21.8.4.7.13, Specific U.S. Residency Certification Language for Specific Treaty Countries.

Claiming Treaty Benefits

  1. Applicants can claim treaty benefits by submitting Form 6166, U.S. Residency Certification, and/or the foreign country's form to the withholding agent or any other appropriate person or office in the foreign country, when applicable.

  2. Applicants that fail to file a claim with the foreign country for treaty benefits and have paid foreign taxes exceeding the treaty rate may suffer the consequences of double taxation. Applicants cannot submit a claim to the IRS (Form 1116, Foreign Tax Credit, or Form 1118, Foreign Tax Credit - Corporations) for the amount in excess of the treaty rate.

Teachers and Researchers (except Japan)
  1. Generally, an applicant who files Form 2555, Foreign Earned Income, with his tax return is not eligible for Form 6166, U.S. residency certification, without providing additional information.

  2. Some tax treaties provide an exemption from foreign country income tax on remuneration received in consideration of teaching or research activities if, among other treaty requirements, the individual is a U.S. resident immediately before visiting the foreign country. The treaty benefits are generally available for a period of two or three years.

  3. Many foreign countries require a U.S. individual to submit Form 6166 in order to claim a treaty benefit.

  4. A statement made under penalties of perjury must accompany the Form 8802 if the applicant states they are eligible of treaty benefits. Complete the following:

    • The tax treaty and article that provides such benefits

    • The period of time the benefit is available under the tax treaty (i.e., two or three years)

    • The beginning and ending dates of the teaching assignment

    • That the individual was a U.S. resident within the meaning of the Residence article of the treaty immediately before entering the foreign country. Depending on the treaty, a statement regarding the physical presence in the United States for U.S. citizens and green card holders may be required. See IRM 21.8.4.7.4.6, Teacher and Researcher Treaty Articles, for additional information.

  5. Verify the individual’s last return was filed as a U.S. resident.

  6. If the individual’s application includes the statement and falls within the time constraints identified in the tax treaty, issue the Form 6166.

Teachers and Researchers - Japan
  1. Generally, an applicant filing a Form 2555, Foreign Earned Income, with a tax return is not eligible for Form 6166, U.S. Residency Certification, without providing additional information.

  2. Under Article 20 of the U.S. - Japan tax treaty, an individual who continues to be a U.S. resident (within the meaning of Article 4(1)) while visiting Japan for purposes of teaching or conducting research may be exempt from tax on such salary in Japan for a period not to exceed two years.

  3. Japan requires U.S. individuals to submit Form 6166 in order to claim treaty benefits.

  4. A statement made under penalties of perjury must accompany the Form 8802 if the applicant states they are eligible for treaty benefits. Complete the following:

    • The person is claiming benefits under U.S. - Japan tax treaty Article 20

    • The treaty benefit is available for 2 years

    • The beginning and ending dates of the teaching assignment

    • That the individual is (and will continue to be) a U.S. resident within the meaning of Article 4(1) of the U.S. - Japan treaty (i.e., he is a U.S. citizen or green card holder).

  5. Verify the individual’s last return was filed as a U.S. resident.

  6. If the individual’s application includes the statement and falls within the time constraints identified in the tax treaty, issue the Form 6166.

Teacher/Researcher Time of Benefit
  1. All treaties that provide benefits to teachers and/or researchers provide such benefits for a two-year period, except for the treaties with China and Greece, which provide benefits for a three-year period.

  2. The two (or three) year period during which treaty benefits are available begins on the date the taxpayer enters the foreign country to begin teaching. Thus, the teacher may be eligible for a Form 6166 for three (or four) different calendar years.

    Example:

    The teacher enters the foreign country on October 1, 2011 and continues to teach through September 30, 2013. The teacher is eligible for a Form 6166 in 2011, 2012, and for the period between January 1, 2013 and September 30, 2013.

Teacher/Researcher Certification Paragraph (except Japan)
  1. If an individual applies for a Form 6166 after filing a Form 2555 with his tax return, and he meets the requirements in IRM 21.8.4.7.4.1, Teachers and Researchers (Except Japan), the Form 6166 must be printed using the manual override function.

  2. The certification should read," I certify that, to the best of our knowledge, the above-named taxpayer was a resident of the United States of America for purposes of U.S. taxation immediately before entering [Name of Country]."

Teacher/Researcher Certification Paragraph - Japan
  1. If an individual applies for a Form 6166 after filing a Form 2555 with his tax return, the application will be systematically rejected with post-IDRS Status Code 510. If this occurs and the individual meets the requirements in IRM 21.8.4.7.4.2, Teachers and Researchers - Japan, the Form 6166 must be printed using the manual override function.

  2. The certification should read," I certify that, to the best of my knowledge, the above-named taxpayer is, and will continue to be, a resident of the United States of America for purposes of U.S. taxation."

Teacher and Researcher Treaty Articles
  1. This is a chart of treaty countries, the Teacher/Researcher Article number and sample statements needed if a Form 2555 was filed for the year of the requested U.S. Residency Certification.

    Country Teacher Article Sample additional statement required for U.S. citizens and green card holders
    Bangladesh 21 None
    Belgium 19 Immediately before entering Belgium, I was a U.S. resident who had a substantial presence, permanent home or habitual abode in the United States, and I was not a resident of a State other than Belgium for the purposes of a double taxation convention between that State and Belgium.
    Bulgaria 19 None
    China (3 years) 19 Immediately before entering China, I was a U.S. resident who had a substantial presence within the United States, and I was not a resident of a State other than China for the purposes of a double taxation convention between that State and China.
    Czech Republic 21 Immediately before entering the Czech Republic, I was a U.S. resident who had a substantial presence, permanent home, or habitual abode in the United States.
    Egypt 22 Citizens: Immediately before entering Egypt, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Egypt 22 Green card holders: Immediately before entering Egypt, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    France 20 Immediately before entering France, I was a U.S. resident who had a substantial presence in the United States or was a resident of the United States and not of a third State under the principles of Article 4(3)(a) and (b) of the U.S.-France Income Tax Treaty.
    Germany 20 Immediately before entering Germany, I was a U.S. resident who had a substantial presence, permanent home, or habitual abode in the United States.
    Greece (3 years) XII None
    Hungary 17 None
    India 22 None
    Indonesia 20 Immediately before entering Indonesia, I was a U.S. resident who had a substantial presence in the United States.
    Israel 23 Immediately before entering Israel, I was a U.S. resident who was not a resident of Israel and had a substantial presence, permanent home or habitual abode in the United States.
    Italy 20 Immediately before entering Italy, I was a U.S. resident who was not a resident of Italy and had a substantial presence, permanent home, or habitual abode in the United States.
    Jamaica 22 Citizens: Immediately before entering Jamaica, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Jamaica 22 Green card holders: Immediately before entering Jamaica, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Japan 20 None (See IRM 21.8.4.7.4.2)
    Korea 20 Citizens: Immediately before entering Korea, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Korea 20 Green card holders: Immediately before entering Korea, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Luxembourg 21 Immediately before entering Luxembourg, I was a U.S. resident who was not a resident of Luxembourg and had a substantial presence, permanent home or habitual abode in the United States.
    Netherlands 21 Immediately before entering the Netherlands, I was a U.S. resident who was not a resident of the Netherlands, and (i) I was a resident of the United States and not a third State, under the principles of Article 4(2)(a) and (b) of the U.S.-Netherlands Income Tax Treaty, if that third State is one with which the United States does not have a comprehensive income tax Convention, or (ii) I was a resident of the United States and not a third State, if that third State is one with which the United States does have a comprehensive income tax Convention, under the provisions of that Convention.
    Norway 15 Citizens: Immediately before entering Norway, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Norway 15 Green card holders: Immediately before entering Norway, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Pakistan XII Citizens: Immediately before entering Pakistan, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Pakistan XII Green card holders: Immediately before entering Pakistan, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Philippines 21 Citizens: Immediately before entering the Philippines, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Philippines 21 Green card holders: Immediately before entering the Philippines, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Poland 17 Citizens: Immediately before entering Poland, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Poland 17 Green card holders: Immediately before entering Poland, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Portugal 22 Immediately before entering Portugal, I was a U.S. resident who had a substantial presence in the United States, or I was a resident of the United States and not of a third country under the principles of Article 4(2)(a) and (b) of the U.S. - Portugal Income Tax Treaty.
    Romania 19 Citizens: Immediately before entering Romania, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Romania 19 Green card holders: Immediately before entering Romania, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Slovak Republic 21 Immediately before entering Slovakia, I was a U.S. resident who had a substantial presence, permanent home, or habitual abode in the United States.
    Slovenia 20 Immediately before entering Slovenia, I was a U.S. resident who was not a resident of Slovenia, and who had a substantial presence, permanent home or habitual abode in the United States.
    Thailand 23 Immediately before entering Thailand, I was a U.S. resident who was not a resident of Thailand, and who had a substantial presence, permanent home or habitual abode in the United States.
    Trinidad and Tobago 18 Citizens: Immediately before entering Trinidad and Tobago, I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    Trinidad and Tobago 18 Green card holders: Immediately before entering Trinidad and Tobago, I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Turkey 20 Immediately before entering Turkey, I was a U.S. resident in accordance with the principles of Article 4(2)(a)-(d) of the U.S.-Turkey Income Tax Treaty.
    United Kingdom 20A Immediately before entering the United Kingdom, I was a U.S. resident who had a substantial presence, permanent home or habitual abode in the United States, and was not a resident of a State other than the United Kingdom for the purposes of a double taxation convention between that State and the United Kingdom.
    U.S.S.R. (Armenia, Azerbaijan, Belarus, Georgia, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, and Uzbekistan) VI Citizens: Immediately before entering [country name], I was a U.S. resident in accordance with the principles of Treas. Reg. § 1.871-2(b).
    U.S.S.R. (Armenia, Azerbaijan, Belarus, Georgia, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, and Uzbekistan) VI Green card holders: Immediately before entering [country name], I was a U.S. resident in accordance with the principles of IRC § 7701(b).
    Venezuela 21 Immediately before entering Venezuela, I was a U.S. resident who was not a resident of Venezuela and who had a permanent home or habitual abode in the United States.

    Note:

    There is a 2 year time limit for benefits (all countries except China and Greece (3 year time limit))

Certifications Rejected by Treaty Countries

  1. Refer certifications rejected by Treaty Countries that result in a double taxation to the Competent Authority.

  2. Refer certification recipients that are entitled to a reduction in the foreign statutory rate of tax, or an exemption from foreign tax for certain types of income according to treaty but are denied, to Rev. Proc. 2015-40.

  3. Rev. Proc. 2015-40 can be located on the internet at www.irs.gov . It explains the procedures for requesting Competent Authority assistance.

  4. The Competent Authority will only address matters covered in the applicable tax treaty.

  5. Competent Authority Claims should be mailed to:

    Internal Revenue Service
    Large Business & International Commissioner
    SE:LB:TTPO:TA:TAIT
    1111 Constitution Ave. N.W., MA3-322A
    Washington, DC 20224–2002

Dependencies and Areas of Special Sovereignty

  1. The following chart shows Federal Information Processing Standard (FIPS) codes for Dependencies and Areas of Special Sovereignty. Use these codes when processing certification requests when the applicant specifies one of these dependencies.

  2. When the dependency's FIPS code is not valid, contact the HQ analyst via your P&A analyst.

  3. The U.S. does not have treaties with dependencies. Therefore, an applicant for a certification for a dependency must provide an explanation on Form 8802, Line 9, Purpose for Certification, as to why certification is being requested.

    Note:

    Enter applications that do not specify purpose on the database and issue Letter 4064C.

    Dependencies and Areas of Special Sovereignty FIPS Code
    Akrotiri AX
    American Samoa AQ
    Anguilla AV
    Antarctica AY
    Aruba AA
    Ashmore and Cartier AT
    Baker Island FQ
    Bermuda BD
    Bouvet Island BV
    British Indian Ocean Territory IO
    Cayman Islands CJ
    Christmas Island KT
    Clipperton Island IP
    Cocos (Keeling) Islands CK
    Cook Island CW
    Coral Sea Islands CR
    Dhakelia DX
    Falkland Islands (Islas Malvinas) FK
    Faroe Islands FO
    French Guiana FG
    French Polynesia FP
    French Southern and Antarctic Lands FS
    Gibraltar GI
    Greenland GL
    Guadeloupe (Currently considered part of France) FR unless GP required by GP
    Guam GQ
    Guernsey GK
    Heard Island and McDonald Island HM
    Hong Kong HK
    Howland Island HQ
    Jan Mayen JN
    Jarvis Island DQ
    Jersey JE
    Johnston Atoll JQ
    Kingman Reef KQ
    Macau MC
    Man, Isle of IM
    Martinique (Currently considered part of France) Use FR unless MB required
    Mayotte MF
    Midway Island MQ
    Montserrat MH
    Navassa island BQ
    Netherlands Antilles NT
    New Caledonia NC
    Niue NE
    Norfolk Island NF
    Northern Mariana Islands CQ
    Palmyra Atoll LQ
    Paracel Islands PF
    Pitcairn Islands PC
    Puerto Rico RQ
    Reunion (Currently considered part of France) Use FR unless RE required
    Saint Barthelemy TB
    Saint Helena SH
    Saint Pierre and Miquelon SB
    South Georgia and South Sandwich Islands SX
    Spratly Islands PG
    Svalbard SV
    Taiwan TW
    Tokelau TL
    Turks and Caicos Islands TK
    Virgin Islands - U.S. VQ
    Virgin Islands - British VI
    Wake Island WQ
    Wallis and Futuna WF
    Western Sahara WI

Non-Treaty Countries

  1. The following are non-treaty country codes. Applicants requesting certification for the following non-treaty countries, or any new non-treaty country, must provide an explanation on Form 8802, Line 9, Purpose for certification, as to why certification is being requested.

  2. Applicants that request certification for a non-treaty country, and later receive a refund of all or part of the foreign taxes paid, must amend their U.S. filing when a foreign tax credit was taken for taxes they were refunded. Applicants that fail to notify the IRS of foreign tax refunds or change in the dollar amount of foreign taxes paid, may have to pay a penalty.

  3. When an explanation of why certification is requested for a non-treaty country is not provided, enter the Form 8802 on the database and issue Letter 4064C.

    Non-Treaty Country Code
    Afghanistan AF
    Albania AL
    Algeria AG
    Andorra AN
    Angola AO
    Antigua and Barbuda AC
    Argentina AR
    Bahamas BF
    Bahrain BA
    Belize BH
    Benin BN
    Bhutan BT
    Bolivia BL
    Bosnia and Herzegovina BK
    Botswana BC
    Brazil BR
    Brunei BX
    Burkina Faso UV
    Burma BM
    Burundi BY
    Cambodia CB
    Cameroon CM
    Cape Verde CV
    Central African Republic CT
    Chad CD
    Chile CI
    Colombia CO
    Comoros CN
    Congo (Brazzaville) CF
    Congo (Kinshasa) CG
    Costa Rica CS
    Cote d'Ivoire (Ivory Coast) IV
    Croatia HR
    Cuba CU
    Djibouti DJ
    Dominica DO
    Dominican Republic DR
    East Timor TT
    Ecuador EC
    El Salvador ES
    Equatorial Guinea EK
    Eritrea ER
    Ethiopia ET
    Fiji FJ
    Gabon GB
    Gambia GA
    Ghana GH
    Grenada GJ
    Guatemala GT
    Guinea GV
    Guinea-Bissau PU
    Guyana GY
    Haiti HA
    Holy See VT
    Honduras HO
    Iran IR
    Iraq IZ
    Jordan JO
    Kenya KE
    Kiribati KR
    Korea, North KN
    Kuwait KU
    Laos LA
    Lebanon LE
    Lesotho LT
    Liberia LI
    Libya LY
    Liechtenstein LS
    Macedonia, Former Yugoslav Republic of MK
    Madagascar MA
    Malawi MI
    Malaysia MY
    Maldives MV
    Mali ML
    Marshall Islands RM
    Mauritania MR
    Mauritius MP
    Micronesia FM
    Monaco MN
    Mongolia MG
    Montenegro MJ
    Mozambique MZ
    Namibia WA
    Nauru NR
    Nepal NP
    Nicaragua NU
    Niger NG
    Nigeria NI
    Oman MU
    Palau PS
    Panama PM
    Papua New Guinea PP
    Paraguay PA
    Peru PE
    Qatar QA
    Rwanda RW
    Saint Kitts and Nevis SC
    Saint Lucia ST
    Saint Vincent and the Grenadines VC
    Samoa WS
    San Marino SM
    Sao Tome and Principe TP
    Saudi Arabia SA
    Senegal SG
    Serbia RI
    Seychelles SE
    Sierra Leone SL
    Singapore SN
    Solomon Island BP
    Somalia SO
    Sudan SU
    Suriname NS
    Swaziland WZ
    Syria SY
    Tanzania TZ
    Togo TO
    Tonga TN
    Tuvalu TV
    Uganda UG
    United Arab Emirates AE
    Uruguay UY
    Vanuatu NH
    Vietnam VM
    Yemen YM
    Zambia ZA
    Zimbabwe ZI

Processing Procedures/Policy on the use of FAX Signatures

  1. Procedures have been developed to reduce applicant/practitioner burden as well as reducing the time it takes to resolve applicant cases or inquiries.

  2. The filing of original tax returns via fax is only allowed:

    • As part of a return perfection process (e.g., secure missing schedule or missing signature) initiated by the IRS

    • As part of a return in post-filing/non-filing activity.

    Note:

    Per Chief Counsel, fax signatures are allowed, even when an applicant signature is required, in circumstances where contact with the applicant has been made and documented.

  3. Submission of documentation, forms, letters, and returns related to post-filing/non-filing inquiries and interactions can be allowed via fax, based on taxpayer or IRS request, unless there is a specific prohibition.

  4. Do not acknowledge faxes received from taxpayers in the course of tax administration activities. Exceptions can be made in unusual circumstances as determined by management.

  5. The specific forms, documents, and letters listed below can be received by fax. The list is not all inclusive.

    • EIN Requests (Form SS-4)

    • Power-of-Attorney (Form 2848)

    • Taxpayer Information Authorization (Form 8821)

    • 1120S Election (Form 2553)

    • Return Transcript Requests (Form 4506)

    • Appeals Conference Requests, and

    • Response/documentation needed to resolve filing or post-filing questions or correspondence.

IRS Initiated Correspondence - Guidelines

  1. When the certification requestor fails to provide the required information for the type of entity needing certification, the requestor must be notified. If the issue cannot be resolved by telephone contact, the requestor must be notified in writing.

  2. The following chart contains some of the letters established for requesting additional information for the U.S. Residency Certification applications:

    U.S. Residency Certification Suspense Letters
    Letter No. Title/Description
    3426C No U.S. tax return on file for requested year - Individual/Possible Minor Child
    3429C Partnership - Required certification application information needed
    3430C Exempt Organization - Required certification application information missing
    3431C Employee Plans (EPMF) - request for required certification application information
    3432C Entity Information Invalid
    3437C Request valid NAICS code
    3441C "S" Corp. — Request for required certification application information
    3443C Partnership - None of the Partners filed
    3444C No Return Filed - Possibly newly formed business - Additional information required
    3446C Resident Alien VISA holders - Request for 1040 filing explanation
    3536C Request for Current Year required information for pass-through entities.
    3633C Request for Current Year required information for Single member LLC
    3634C Request for Current Year required information for all entity types except pass through entities.
    3635C Request for POP for newly formed Single Member LLC
    3636C Request for Certification Country
    3637C Request for Second Tier Partnership information
    3644C Request for Corporation's Country of Incorporation
    4064C Incomplete Form 8802 information
  3. If additional information is needed and there is not a letter in the chart above to request the information, submit a request to have one established via your Planning and Analysis Analyst.

    Reminder:

    All new letters or revisions to existing letters must be approved by the Office of Taxpayer Correspondence.

  4. When one of the letters in the above chart has been issued, the system generates a letter issue date.

  5. You must allow the applicant 30 days (60 for taxpayers overseas) from the letter issued date to respond to your request for additional information.

    IF THEN
    The applicant responds (by mail, FAX, or phone call) with the requested information within the 30 day time frame (60 days if overseas) Enter the response date in the Correspondence Received date field and continue processing.
    The applicant responds (by mail, FAX, or phone call) with the requested information after the allotted 30 days (60 days overseas), and if the status of the application has not been updated since the issuance of the suspense letter Enter the response date in the Correspondence Received date field and continue processing.
    The applicant responds (by mail, FAX, or phone call) with the requested information after the allotted 30 days (60 days overseas), and the case is closed A new case must be opened.
    The applicant fails to respond with the requested information within 30 days (60 days if overseas) Update the status of the letter or close the application as a No Reply or the application will remain on the weekly correspondence list.
    Contact has been made with the applicant and the service is waiting for a response Update the status of the application, or risk having the case auto closed.

    Note:

    All open correspondence that has a letter issued date and a status date that is 60 days or older is auto closed as a No Reply.

    An applicant contacts the Certification Unit to question under what authority the requested information is being required Inform the applicant of the following: "you are only required to provide the requested information if you wish to have your U.S. Residency for tax purposes confirmed" .
    An applicant refuses to provide the requested information Close the Certification application as a No Reply, using status code 199 and entering "No reply" in the remarks field.
  6. The Status Code 702 is an Additional Suspense Status Code - 700 series status codes are suspense codes that cannot be corrected or overridden.

  7. A Status Code 702 is used to hold an application in suspense when it is being forwarded to P&A, HQ, or when awaiting additional information from the applicant. The case stays in this status for 60 days from the Status Date; however, a P&A/HQ analyst usually responds within 45 days.

Notification of Rejection

  1. Certifications should only be issued to U.S. residents that filed a U.S. Income Tax Return as a resident, or to U.S. residents who aren't required to file a return.

  2. Deny certification when IRS records indicate that the applicant is required to file a return but failed to or filed as a nonresident.

  3. Deny certification when IRS records indicate the applicant claimed a foreign tax home in the countries listed below, and then requested certification for the same country:

    • Bangladesh

    • Bulgaria

    • Cyprus

    • Hungary

    • Iceland

    • India

    • Kazakhstan

    • Malta

    • New Zealand

    • Russia

    • South Africa

    • Sri Lanka

    • Ukraine.

  4. When the certification application needs to be rejected, issue one of the following letters:

    U.S. Residency Certification Rejection Letters
    Letter No. Title/Description
    3425 Taxpayer is a bona fide resident of a foreign country or possession
    3427 Third Party Application/requestor not authorized
    3436 Requested Form is not Eligible for U.S. Residency Certification
    3442 S" Corp. - None of the Shareholders filed or one filed a 1040NR
    3445 No Return Filed - Taxpayer Deceased
    4063 U.S. Certification Declined Possible Foreign Residence
  5. When one of the letters in the above chart has been issued, the certification application has been rejected and the case is considered closed. If the requestor provides additional information for consideration after one of the rejection letters has been issued and the case is closed, then:

    1. Open a new case.

    2. Circle out the original received date on the application.

    3. Notate the received date on the application as the date of the Correspondence.

    4. Enter that date as the received date on the database.

Verifying Residency

  1. In certifying an applicant as a United States resident, generally verify that the applicant either:

    • Filed the required tax return

    • Filed a valid extension and the return due date has not passed

    • Is not liable to file a tax return, or

    • Is tax exempt.

  2. When the certification application is for a tax year for which the return or extension was recently due but is not yet posted, the requestor should have submitted a signed copy of the return with the application.

    If Then
    The copy of the return was not submitted with the Form 8802 Correspond for a signed copy of the applicant’s entire tax return. Contact can be made via phone, letter 3426, or letter 3444.
    The return is received Verify that the applicant meets the certification requirements.
    The applicant meets the certification requirements Issue certification and shelve the return until the end of the filing season.
    The filing season has ended Research for posting of the return.
    The return has posted Discard as classified waste.
    The return has not posted Label return as possible duplicate and follow local procedures for forwarding the return for processing.
  3. When the certification application is for a tax year for which the return is not yet due or an extension has been filed, verify:

    1. That applicants have submitted the appropriate penalties of perjury statements for current year Form 990, Form 1040, Form 1065, Form 1120, Form 1120SForm 5500, Common Trust Fund (CTF), LLC, and Trust applications, and

    2. That a return has been filed for the most recently required tax year, or

    3. If there is a valid extension posted, you must apply all certification requirements to the prior year tax return.

      Note:

      A valid extension, for purposes of receiving certification, is one that has not expired.

  4. When verifying residency, use any command available. See IRM 2.3, IDRS Terminal Responses, or Document 6209 (IRS Processing Codes and information) for input instruction.

  5. Using one of the command codes available and the TIN provided, verify that the applicant has filed the type of form and tax period specified on the application for certification.

    If Then
    The applicant has met all requirements Certify using the instructions specified for that form.
    The applicant has not met all requirements Issue the letter that is appropriate for the type of form specified on the application. See IRM 21.8.4.7.9., IRS Initiated Correspondence - Guidelines, and IRM 21.8.4.7.10, Notification of Rejection.
    The application is from the applicant, and the form filed is other than the form specified on the application Certify the application using the instructions for the type of form posted to the applicant's account.
    The requestor is someone other than the applicant, and the form filed is other than the form specified on the application Reject with appropriate letter.

    Note:

    See the specific form instructions when determining all of the information and documentation necessary to certify the application.

Applicant Requirements, Return and U.S. Residency Certification Information

  1. The following section contains the information and guidance necessary for certifying an applicant as a U.S. resident for tax purposes.

Nominee Applicants
  1. An individual or organization that acts as a nominee on behalf of another individual or organization is considered the individual's or the organization's nominee.

    Note:

    If a nominee is a partnership, do not provide information concerning the partners in the Nominee partnership. Verification of the residence of the individual or organization the nominee represents must be completed.

  2. Nominee applicants must submit:

    1. An authorization statement signed under penalties of perjury by the individual or an officer of the organization with legal authority to bind the organization for whom the applicant is a nominee explicitly authorizing the nominee to act on behalf of the individual or organization and to receive the individual’s or organization’s tax information.

      Note:

      The authorization statement must be for specific tax matters, or it must be rejected.

    2. A statement signed under penalties of perjury from an individual with legal authority to bind the nominee applicant, explicitly stating that the nominee is acting as an agent on behalf of the above-named individual or entity for whom the Form 6166 is being requested.

    3. A list and the requirements of all the individual(s) or entity(ies) for which the applicant is a nominee.

      Example:

      A nominee for a Partnership must attach the Partnership's required list of partners as well as authorization from each partner giving the nominee the authority to receive the Partner's tax information. When the application is for the current year, the nominee must also provide a current year penalties of perjury statement.

  3. When entering a Nominee applicant in the certification database:

    1. Enter the TIN of the taxpayer the Nominee is representing in the Primary TIN field.

      Note:

      If the taxpayer is an individual and an SSN is being entered, the SSN box must be checked.

    2. Enter the Nominee's TIN in the Secondary TIN field.

    3. Enter the Nominee information in the Applicant field.

    4. Enter the Name Control of the taxpayer the Nominee represents. See IRM 3.8.44, Campus Deposit Activity , for additional information on name controls.

    5. Select the type of taxpayer the Nominee represents in the Applicant Type field. Verify that the Nominee has met all the form requirements, as well as the certification requirements, for the taxpayer the nominee represents.

      Note:

      Currently, all Nominee applicants are partnerships. If a Nominee application is received and the nominee is not a partnership, contact the Process and Analysis Analyst.

  4. Do not certify the Nominee applicant as a resident. Certify the taxpayer for whom the applicant is a nominee.

  5. When the taxpayer the Nominee represents has its residency status verified, certification will be issued using the paragraph NOM.PTR:

    " I certify that the above-named partnership is an agent acting on behalf of the following list of individuals and entities, and to the best of our knowledge, each individual or entity listed below is a resident of the United States of America for purposes of U.S. taxation."

Individual Applicants
  1. U.S. Citizens are required to file Form 1040, Form 1040A or Form 1040EZ and report their worldwide income when their gross income exceeds the minimum dollar amount established for the filing status and the tax year for which the applicant is claiming U.S. residency. The Form 8802 for these applicants should include:

    • Applicant Information (Name and TIN of applicant and spouse, if applicable, for whom certification is requested)

    • Line 1, Name and TIN to be printed on the certification when different from the applicant information

    • Line 2, Applicant's Address during the period for which certification is requested

    • Line 3a, Mailing Address for the certification

    • Line 3b, Appointee information (if applicable)

    • Line 4, Applicant Entity Type should be box a, individual

    • Line 5, Form required to be filed

    • Line 6, Parent information, when the applicant is a minor not filing an individual return

    • Line 7, Requested certification year (the year the applicant wants printed on the Form 6166)

    • Line 8, Tax period on which the certification will be based

    • Line 9, Certification Type/Purpose

    • Line 10, Penalties of Perjury statements (when applicable)

    • Line 11, Country and number of certifications requested

    • Form 8802 must contain the signature of the applicant(s) or someone authorized to represent the applicant(s) and date

  2. U.S. citizens that file married filing joint returns, but need individual certification and are not the primary taxpayer on the joint filed return, must have:

    1. CC INOLES verified to ensure that the TIN of the applicant requesting certification is listed on the primary taxpayer's entity screen, and

    2. CC IMFOLT verified to ensure that the primary applicant filed a joint return for the tax year being certified.

      Note:

      Check IMFOLT for the most recent year when processing current year certification.

    3. Once the application has been verified utilizing the command codes listed above, the certification application can be processed.

  3. U.S. citizens who are not required to file a tax return must provide a written statement under penalties of perjury explaining why the law does not require the filing of a tax return for the tax period the treaty benefit is claimed. Check Form 8802 for the statement. The applicant must also supply proof of income such as Form W-2, Form 1099, etc. when applicable. The Form 8802 should also include:

    Note:

    This information must be verified using the following: the Form instructions, Internal Revenue Code or Regulations, an Examination Classifier, Program and Analysis Analyst, etc.

    • Applicant Information (Name and TIN)

    • Line 1, Name and TIN as it should appear on the Certification , if different from the Applicant information

    • Line 2, Applicant's Address during the period for which certification is requested

    • Line 3a, Mailing Address (if other than applicant's address)

    • Line 3b, Appointee name and address, when applicable

    • Line 4, Entity type is individual

    • Line 5, NO box must be checked

    • Line 7, Calendar Year for which certification is requested

    • Line 8, Tax period on which certification is based

    • Line 9, Certification type/purpose

    • Line 10, Penalties of Perjury statement, indicating why applicant is not required to file and proof of income

    • Line 11, Country and number of certifications requested

    • A valid signature and date

  4. For U.S. citizens under the age of 19 (or under age of 24 if a full-time student) whose parents have elected to use Form 8814, Parents' Election to Report Child's Interest and Dividends , to report the child's income on their return, Form 8802 must include:

    • Applicant Information (Child's Name and TIN)

      Note:

      This TIN should be placed in primary TIN field.

    • Line 1, Name and TIN as it should appear on Certification, if different from the Applicant information

    • Line 2, Applicant's Address during the period for which certification is requested

    • Line 3a, Mailing Address (if other than applicant's address)

    • Line 3b, Appointee name and address, when applicable

    • Line 4, Entity type is individual

    • Line 5, NO box must be checked

    • Line 6, Parents’ information

    • Line 7, Calendar Year for which certification is requested

    • Line 8, Tax period on which certification is based

    • Line 9, Certification type/purpose

    • Line 10, Penalties of Perjury statement, indicating why applicant is not required to file and proof of income

    • Line 11, Country and number of certifications requested

    • A valid signature and date.

    • Copy of the Form 8814

  5. For U.S. residents under the age of 19 (or under age of 24 if a full-time student) whose parent/parents have NOT elected to use Form 8814, Parents' Election to Report Child's Interest and Dividends, to report the child's income on their return, Form 8802 must include:

    • Applicant Information (Child's Name and TIN)

      Note:

      This TIN is placed in primary TIN field.

    • Line 1, Name and TIN as it should appear on Certification, if different from the Applicant information

    • Line 2, Applicant's Address during the period for which certification is requested

    • Line 3a, Mailing Address (if other than applicant's address)

    • Line 3b, Appointee name and address, when applicable

    • Line 4, Entity type is individual

    • Line 5, NO box must be checked

    • Line 6, Parents’ information

    • Line 7, Calendar Year for which certification is requested

    • Line 8, Tax period on which certification is based

    • Line 9, Certification type/purpose

    • Line 10, Penalties of Perjury statement, indicating why the minor is not required to file and proof of income

    • Line 11, The country and number of certifications requested

    • A valid signature and date

      Note:

      A minor must file his or her own income tax return if the parents did not file a Form 8814 claiming the minor’s income. A minor can request a certification if he or she did not have to file a tax return because his or her income fell below the filing requirement. The minor must provide proof of income and a penalties of perjury statement explaining this situation.

  6. When entering a minor under the age of 19 (or under age of 24 if a full-time student) in the certification database:

    1. Check the SSN box.

    2. Enter in the Primary TIN field, the TIN of the Parent that filed the return which included the income of the minor child.

    3. Check the SSN box.

    4. Enter in the Secondary TIN field, the Minor's TIN.

    5. Check the Non-spouse box.

    6. Enter in the Applicant field, the Minor's entity information.

    7. Enter in the Name Control field, the name control of the Minor's parent that filed the return which included the Minor's income. See Document 6209 , or Document 7071-A, BMF Name Control Job Aid, for additional information on name controlling.

    8. Select Individual as the applicant in the Applicant Type field.

  7. Certification applications for U.S. Citizens who are deceased must include:

    1. Proof that requestor is executor or administrator of the decedent's estate.

      Note:

      Proof includes a court document identifying the executor or administrator.

    2. The Form 8802 should include all of the information identified in paragraph 1 above.

  8. In addition to the information required above (IRM 21.8.4.7.12.2, Individual Applicants), U.S. citizens and green card holders may attach to their Form 1040, U.S. Individual Income Tax Return, one of the following:

    1. Form 2555, Foreign Earned Income

    2. Form 1116, Foreign Tax Credit, claiming either a foreign tax credit amount in excess of 5,000 U.S. dollars or a foreign tax credit for any amount of foreign earned income

    3. Form 5074, Allocation of Individual Income Tax to Guam or the Commonwealth of the North Mariana Islands (CNMI)

    4. Form 8689, Allocation of Individual Income Tax to the U.S. Virgin Islands

    5. Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa

  9. Except as provided in paragraph (10) and (11) below, these applicants must include additional information to establish that the taxpayer has sufficient connection with the United States to be considered a U.S. resident for the purposes of the applicable tax treaty with the foreign country for which certification is requested. The type of connection that is required depends upon the language in the specific treaty for which certification is requested. However, treaties usually require the taxpayer to have either:

    • A substantial presence within the United States (at least 31 days during the current year and 183 days during the period that includes the current year and the 2 years immediately preceding the current year, counting each day during the first preceding year as 1/3 of a day, and each day in the second preceding year as 1/6 of a day) . See Pub 519, U.S. Tax Guide for Aliens, to apply the substantial presence test. ;

    • A permanent home within the United States; or

    • A habitual abode within the United States.

  10. Certification may also be issued to such taxpayer if the Form 2555 was not filed by the applicant (it belongs to the spouse), or if Form 2555 is for a partial year, and the certification year requested is for the remainder of the year.

  11. Exception: U.S. citizens and green card holders living outside the United States who are requesting certification for Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine are not required to submit additional information (described above in paragraphs (8) and (9)) and may be certified, provided that the individual is not a dual resident of the country for which certification is requested. When determining if an applicant that has filed Form 1040, with an attached Form 2555 requesting certification for the country of Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine is eligible for U.S. residency certification, a very important factor is the post of duty (POD) claimed on the Form 2555. Use the following chart with CC RTVUE when processing a Form 8802 from an applicant that has filed Form 1040, with an attached Form 2555 requesting certification for the country of Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine to check the POD code to ensure that the applicant was not a resident of that same country.

  12. If an individual is a resident of both the United States and the country for which certification is requested, the certification may be denied, unless the individual can establish that the individual is solely a resident of the United States under the tiebreaker provision of the applicable treaty. The 2006 U.S. Model treaty tiebreaker provision reads — Where an individual is a resident of both Contracting States, then the status shall be determined as follows:

    IF THEN
    Has a permanent home in the specific state The individual shall be deemed to be a resident of the State in which a permanent home has been established.
    A permanent home is available to the individual in both States The individual shall be deemed to be a resident of the State with which personal and economic relations are closer (center of vital interests).
    The State in which the individual has a center of vital interests cannot be determined, or if a permanent home has not been established in either state The individual shall be deemed to be a resident of the State in which a habitual abode has been established.
    A habitual abode has been established in both States or in neither of them The individual shall be deemed to be a resident of the national state.
    The individual is a national of both States or neither of them The competent authorities of the Contracting States endeavor to settle the question by mutual agreement.

    Note:

    Most U.S. treaties have similar tiebreaker provisions for individuals.

    Note:

    Residency must be determined according to the provisions of the treaty applicable to the specific dual resident individual.

  13. Use the following chart with CC RTVUE when processing a Form 8802 from an applicant that has filed Form 1040, with an attached Form 2555 requesting certification for the country of Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine to check the POD code to ensure that the applicant was not a resident of that same country.

    Certification Country/POD Code Chart
    If Certification Country Is And, Then
    Bangladesh If the POD is other than BG Issue certification.
    Bangladesh If the POD is BG Issue letter 3425.
    Bulgaria If POD is other than BU Issue certification.
    Bulgaria If POD is BU Issue letter 3425.
    Cyprus The POD is other than 19 or CY Issue certification.
    Cyprus The POD is 19 ESTAB for a copy of the return. If the country of residence is Cyprus, issue letter 3425. If the country of residence is other than Cyprus, issue certification.
    Cyprus The POD is CY Issue letter 3425.
    Hungary The POD is other than HU or 15 Issue certification.
    Hungary The POD is HU or 15 Issue letter 3425.
    Iceland The POD is other than IC Issue certification
    Iceland The POD is IC Issue letter 3425.
    Kazakhstan The POD is other than KZ or 15 Issue certification.
    Kazakhstan The POD is KZ Issue letter 3425.
    Malta The POD is other than MT Issue certification.
    Malta The POD is MT Issue letter 3425.
    New Zealand The POD is other than NZ Issue certification.
    New Zealand The POD is NZ Issue letter 3425.
    Russia The POD is other RS or 15 Issue certification.
    Russia The POD is RS or 15 Issue letter 3425.
    Ukraine The POD is other than UP or 15 Issue certification.
    Ukraine The POD is UP or 15 Issue letter 3425.
    Hungary, Kazakhstan, Russia or Ukraine The POD is 15 ESTAB for a copy of the return.
    If the country of residence is the same as the country for which certification is being requested, issue letter 3425.
    If the country of residence is other than the country for which certification is being requested, issue certification.
    India The POD is other than 75 or IN Issue certification.
    India The POD is IN Issue letter 3425.
    India The POD is 75 ESTAB for a copy of the return.
    If the country of residence is India, issue letter 3425.
    If the country of residence is other than India, issue certification.
    South Africa The POD is other than 28 or SF Issue certification.
    South Africa The POD is 28 or SF Issue letter 3425.
    Sri Lanka The POD is other than CE Issue certification.
    Sri Lanka The POD is CE Issue letter 3425.
  14. Once the return has been secured, review the Form 2555, or Form 1116 filed in lieu of Form 2555, and follow the procedures below for processing the certification application:

    If Then
    The application is for the primary applicant and the return indicates the Form 2555 was for the spouse Certify the primary applicant by overriding the status code 500/510, and entering in the remarks "return indicates Form 2555 for spouse."
    The application is for the primary applicant and the return indicates the primary taxpayer claimed the 2555 exclusion Verify the country for which certification is requested.
    The country for which certification is requested is NOT Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or the Ukraine Do not issue a certification. Issue letter 3425.
    The country for which certification is requested is Bangladesh, Bulgaria, Cyprus, Hungary, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or the Ukraine Use the Certification Country/POD Code Chart to determine if certification can be issued, or issue letter 3425.
    The return indicates that Form 2555 is for the primary applicant and the Certification application is for the Secondary Certify the secondary applicant, by overriding the status code 500/510, and entering in the remarks "return indicates Form 2555 for spouse. "
    The return indicates that both applicants' names were entered on the Form 2555 in error (only one person may be listed on Form 2555) Do not issue a certification; see (15) below.
    Correspondence is received from an applicant who claims the 2555 exclusion was for the spouse; however, both names were present on the form The applicant must amend the filing, identifying the correct applicant on the Form 2555.
    The applicant amends the filing to indicate that the Form 2555 was for the spouse Certify the applicant by overriding the status code 500/510, enter in the remarks field "Amended Form 2555 for spouse" and associate the amended form with the original return.
    The return specifically states DUAL STATUS Verify the portion of the year the taxpayer was a U.S. resident. Enter Dual Status in the remarks field and issue Certification for the period in which the applicant was a U.S. resident.
    The return doesn't specifically state DUAL STATUS Do not issue a certification; see (24) below.

    Note:

    Use CC IMFOL when researching amended returns; see Command Code Job Aid for additional instructions.

  15. If the applicant is a resident of a foreign country for the year certification is requested, the applicant is not entitled to treaty benefits, unless approved by mutual agreement between the competent authorities.

    1. Issue Letter 3425, which explains that, according to our records, the applicant claimed a foreign tax home. Accordingly, it has been determined that the applicant is not entitled to treaty benefits and therefore, a U.S. residency certification can not be provided.

      Note:

      Applicants from a U.S. possession that did not claim a possession exclusion, or that are requesting certification for other than the U.S. possession for which the exclusion was taken, can be certified as a resident of the U.S.

    2. Close the case and indicate in the remarks field "International Return" .

  16. U.S. Citizens living in a Foreign Country or Possession are treated as if living in the United States:

    • In the U.S. Armed Forces

    • In the Peace Corps

    • Diplomatic Personnel

      Note:

      These applicants are treated as U.S. citizens living in the U.S. See (1) above in establishing residency.

  17. Resident Aliens are individuals who:

    • Have been admitted for permanent residence in the United States (green card holders)

      Exception:

      Applicants who hold green cards as commuters from Canada or Mexico.

    • Have been in the United States at least 31 days during the current year and 183 days during the period that includes the current year and the 2 years immediately preceding the current year, counting each day during the first preceding year as 1/3 of a day, and each day in the second preceding year as 1/6 of a day (See Pub 519, U.S. Tax Guide for Aliens, to apply the Substantial Presence Test.)

    • Make an election under subsection 6013(g) or (h) to be treated as a resident alien (See Pub 519, Choosing Resident Alien Status.)

  18. Resident Aliens living in the United States are taxed on their worldwide income in a manner similar to U.S. citizens living in the United States; therefore, follow the guidelines above. See IRM 21.8.4.7.12.2, Individual Applicants.

    Exception:

    A1, F1, M1, J1 and Q1 visa holders and their families are subject to special rules. See IRM 21.8.4.7.12.2 (22), Individual Applicants, for additional information.

  19. Resident aliens recently arriving in the United States and have not yet filed a U.S. income tax return, in addition to the requirements listed in IRM 21.8.4.7.12.2, Individual Applicants, must submit:

    1. A copy of the current Alien Registration Receipt Card (green card)

      Note:

      In lieu of a copy of the green card, the applicant may submit a statement from the Bureau of Citizenship and Immigration Services that gives the alien registration number, date and port of entry, date of birth, and classification.

    2. Form I-551, or

    3. The current Form I-94, Arrival-Departure Record (VISA) should be provided.

  20. First year U.S. Residents who have made, or intend to make, the first-year residence election under IRC § 7701(b)(4) must, in addition to the requirements in IRM 21.8.4.7.12.2, Individual Applicants, provide a copy of the election statement required with the 1040 income tax return for the taxable year of the election. See Publication 519, Chapter 1 for details about the first-year residency statement requirements.

  21. When the calendar year for which certification is requested has not yet passed and the applicant has not yet filed a first-year residence election statement, the applicant must attach a statement of intent to file an election statement and that the applicant is eligible to make the election signed under penalties of perjury.

    Note:

    Refer applicants needing additional information on eligibility to file a first-year residence election to Treas. Reg. Sec. 301.7701(b)-4(c)(3).

  22. Generally, A1, F1, M1, J1 and Q1 Visa Holders and their families (A2, A3, F2, F3, M2, J2, Q2, etc.) are not eligible for U.S. residency certification. If an application is received from one of these type visa holders, who filed a Form 1040, the applicant must provide an explanation as to why the Form 1040 was filed, and provide proof that the applicant's worldwide income was reported on the Form 1040.

    1. Place the case in status 702.

    2. Forward all applications with documentation to the HQ Analyst through the P&A Analyst for approval.

  23. Treat an individual applicant as Dual Status taxpayers when, during the tax year for which certification is requested, the individual was both:

    • A U.S. resident

    • A nonresident

  24. Dual Status situations generally occur in the year an alien first arrives in the United States (the year the alien becomes a U.S. Resident for tax purposes), or the year the alien departs from the U.S. (losing or giving up residency status). The dates of residency, on line 4a of Form 8802, must be entered in the dual resident field.

    1. U.S. citizens and green card holders are considered dual status residents when their citizenship or green card holder status was lost during the calendar year.

    2. U.S. residents whose residency termination date occurred during the tax year are also considered dual resident aliens.

    3. Dual status residents must enter the dates of U.S. resident status on line 4a of Form 8802.

      Note:

      A dual status taxpayer who gives up U.S. residency during the tax year files a Form 1040NR. A dual status taxpayer is required to attach a separate schedule to the Form 1040NR to show the income tax computation for the part of the taxable year during which the individual was a citizen or resident of the United States. A Form 1040, clearly marked “Statement” across the top, may be used as such a separate schedule.

  25. Individual certification applicants that need certification for the Current year must include a penalties of perjury statement.

    Note:

    When the prior year return has not been filed and isn't yet required, the penalties of perjury statement must address the applicant's residency status for both the prior year and the current year.

    See IRM 21.8.4.1.12, Current Year Certification Applications.

  26. Follow instructions in the chart below when a Status Code 508 or 509 is generated.

    If Then
    Status 508 Verify that the correct tax year was entered, correct accordingly.
    Correct tax year entered Check FFINQ to see if return received.
    Return received Override 508, issue certification.
    No return located Reject the certification, no return filed.
    Status 509 Verify that the correct tax year was entered.
    Correct tax year entered Check for spouse.
    Spouse located Check to see if return filed using filing status 2 for certification year.
    Filing Status 2 Check to see if applicant identified as the spouse for the tax year of certification.
    Applicant is spouse for the tax year of certification Override status code 509, issue certification.
    No spouse indicated Reject application.
    Spouse located but no filing Reject application.
  27. Once the applicant is verified as a U.S. resident, and therefore entitled to treaty benefits, issue the certification (status code 099). Certify using the appropriate IND.1040 certification paragraph:

    • IND.1040 for basic individuals

    • IND.1040.Dual for Dual Residents

    • IND.1040.GR for Greece

    • IND.1040.SP for Spain

    • IND.1040.RS for Russia

  28. When no return has been filed (CFOL status code 012) and the Date of Birth (DOB) field on the entity indicates that the application is for a minor, issue letter 3426.

  29. When an Individual Applicant (Resident Alien or U.S. citizen) appears to have a filing requirement, but has not filed a U.S. tax return (CFOL status code 509), issue letter 3426. Letter 3426 requires one of the following:

    • Completion of the penalties of perjury statements in Section I and a signed copy of the return

    • Completion of the penalties of perjury statements in Section II and copies of income statements

    • A copy of the Form 8814 that was filed along with the parent name and TIN that filed the form, if applicant is a minor child

Sole Proprietor
  1. U.S. Citizens living in the United States who operate a business, or practice a profession as a sole proprietor, report their income and expenses on Schedule C or Schedule C-EZ of the Form 1040.

  2. Form 8802 for sole proprietors must contain all of the requirements with the name and SSN of the person who filed the Form 1040, Schedule C. See IRM 21.8.4.7.12.2, Individual Applicants.

  3. A Form 8802 may be received that identifies a sole proprietor applicant as:

    • An individual, or

    • A business

  4. A sole-proprietor can have an EIN when a legitimate reason exists for having one, such as:

    1. Being an administrator of a Pension Plan

    2. Doing business with a federal agency

    3. Being classified as an independent contractor with employees and liable for employment tax or excise tax

    4. Establishing a pension, profit sharing, or retirement plan

    5. Having household employees

    6. Being a single member LLC and needing an EIN for banking purposes

  5. When an application is received for a sole proprietor, it must identify the individual name and SSN of the individual who filed the Form 1040, Schedule C, as well as the name of the business and its EIN (when applicable) for which certification is requested.

    If Then
    The Form 8802 does not contain the individual's name and social security number Check IDRS for an x-ref TIN using the business TIN.

    Note:

    Third party applications require correspondence when the Form 8802 does not have the individual's TIN.

    An x-reference TIN is found Using IDRS, research the name associated with the TIN. Then, using the Form 8802, compare the name on IDRS with the signature on the form.
    There is a match of the Form 8802 signature and IDRS individual name line Process the application using the individual’s information.
  6. When entering sole proprietors in the certification database:

    1. Check the SSN box.

    2. Enter the SSN of the individual who filed the return that included the Schedule C income in the Primary TIN field.

    3. Check the SSN box, if the sole proprietor doesn't have an EIN.

    4. Enter the Sole Proprietor's TIN, if applicable, in the Secondary TIN field.

      Reminder:

      Be sure to check the SSN box if the Sole Proprietor's SSN is required in the Secondary TIN field. This is only a requirement if the tax return was filed under the Sole Proprietor's spouse's SSN.

    5. Enter the Sole Proprietor's entity information in the Applicant field.

    6. Enter in the Name Control field the name control of the taxpayer who filed the return that included the Minor's income. See Document 6209, or Document 7071-A, BMF Name Control Job Aid, for additional information on name controlling.

    7. Select Individual as the applicant in the Applicant Type field.

    8. Enter all of other required information.

  7. When an application is received for a sole proprietor, and you cannot identify the individual name and SSN of the individual who filed the Form 1040, Schedule C, correspond using letter 3432C.

  8. When the individual name and the TIN of the sole proprietor can be determined, verify that the individual has filed a Schedule C using CC IMFOL or RTVUE. Verification consists of:

    1. Seeing a Y indicator next to the Schedule C on line 5 of the IMFOL screen

    2. Viewing the actual Schedule C information on RTVUE

      Note:

      If unable to verify that the individual filed a Schedule C, correspond using letter 4061C.

  9. Once it is verified that the sole proprietor has met the filing requirement, issue certification using the appropriate IND.1040.SPRO paragraph for all certification applications, except those for Greece, Spain, Russia or the nine commonwealths. Use:

    • IND.1040.SPRO.GR for all certification applications for Greece

    • IND.1040.SPRO.SP for all certification applications for Spain

    • IND.1040.SPRO.RS for all certification applications for Russia

      Note:

      Currently, these paragraphs are only available using the override button of the 6166 screen on the USRC database.

Corporate Applicants
  1. United States Corporations are incorporated in the United States and are automatically considered resident corporations even if doing business abroad. All such corporations would File Form 1120.

  2. United States Corporations may also include any domestically organized entity that is treated as a corporation for federal tax purposes under the "Check the Box" rules (Treas. Reg. 301.7701-2 through -3).

  3. Corporate applicants that were not incorporated in the United States must specify their country of incorporation on Form 8802.

  4. As a general rule, a corporation that is not incorporated in the United States is not entitled to U.S. Residency Certification. However, there may be exceptions for corporations that, under the following Internal Revenue Code sections, are treated as domestic (U.S.) corporations:

    • IRC § 269B

    • IRC § 953(d)

    • IRC § 1504(d)

    • IRC § 7874(b)

  5. Corporations that are not incorporated in the United States, but are treated as U.S. corporations under IRC § 269B, IRC § 953(d), IRC § 1504(d), or IRC § 7874(b), must specify on Form 8802 the Code section under which the corporation is treated as a domestic corporation. When certification is requested for the same country in which the corporation is incorporated, the application must be forwarded through the P&A analyst to the HQ analyst for review.

    Note:

    Only Canadian and Mexican corporations are eligible to be treated as domestic corporations under IRC § 1504(d).

  6. Corporations that are neither incorporated in the United States, nor treated as a domestic corporation under IRC § 269B, IRC § 953(d), IRC § 1504(d), or IRC § 7874(b) but nevertheless believe entitlement to U.S. Residency Certification, should seek competent authority assistance using Rev. Proc. 2015-40. In addition, the applicant must:

    • Complete Form 8802.

    • Attach a detailed explanation, as to their entitlement.

    • Submit all documentary evidence.

  7. U.S. corporations are required to file one of the corporate forms within the 1120 series in order to qualify for certification. The filing requirements on the Form 1120 filer’s entity module are shown as 1120-01.

    Reminder:

    Form 1120F (1120-06) and Form 1120FSC (1120-15) are excluded.

  8. The Form 1120–IC–DISC, Interest Charge Domestic International Sales Corporation Return, is processed on Non-Master File (NMF). To verify a fact of filing, contact the NMF Accounting Unit.

  9. Certain foreign organized entities that are disregarded for U.S. tax purposes (e.g., a single member LLC) may be certified, provided their income is reported on a consolidated Form 1120 and verified that the U.S. corporation has identified the foreign entity on Schedule N of the Form 1120. See IRM 21.8.4.7.12.10, Limited Liability Company Applicant, for additional instructions.

  10. U.S. corporations, in addition to having filed a tax return or obtained an extension, must provide the following with their certification application:

    • Applicant’s Information (Name of corporation for which certification is being requested)

    • Applicant's TIN

    • Mailing Address (if other than applicant's address)

    • Permanent Residence Address (when applicable)

    • Entity Type must be Corporate

    • Tax Form Filed

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax period

    • Certification Type

    • Country and number of certifications requested

    • TIA (when applicable)

    • Penalty of Perjury statements (when applicable), and

    • Form 8802 must contain a signature of corporate officer or the corporation's POA.

  11. Current year Corporate applications must also include a penalties of perjury statement from a corporate officer with legal authority to bind the corporation stating under penalties of perjury that,

    " XXX corporation is a United States Corporation and shall remain so throughout the current tax year."

  12. Corporate applicants are also required to indicate on Form 8802 whether the corporation is Dual Resident Corporations (DRCs). DRCs must name the other country in which the corporations is a resident. DRCs may not be entitled to U.S. Residency Certification, if requesting certification for the corporation’s other country of residence.

  13. Generally, a DRC of Canada and the U.S. is considered a resident of the country in which the DRC is incorporated. However, an exception to the general rule applies if a DRC is incorporated in both the U.S. and Canada. In such a case, determine where the company was incorporated initially, and if the company continues to be a resident of such country, or if DRC continued (incorporated) in the other country, then it would be a resident of the other country. A dual resident corporation of Canada will always be a U.S. resident because the tie automatically breaks in favor of the place of incorporation (provided it is only incorporated in the U.S.).

    1. If the company is a U.S. corporation that continues into Canada and is incorporated in Canada, then it is not a U.S. resident, because the tie breaks in favor of Canada (the continued country).

    2. If the company originated in Canada and continues into the U.S. and is incorporated in the U.S., then it does get benefits as a U.S. resident.

  14. Dual resident corporations may not be entitled to U.S. residency certification, if requesting certification for the other country of residence named on Line 4e of Form 8802. See the chart below for determining if a DRC is entitled to treaty benefits in its dual resident country:

    Dual Resident Country Corp. entitled to benefit from the other country?
    Austria Yes, if incorporated in the U.S.
    Australia No, never entitled to benefits
    Bangladesh Yes, if incorporated in the U.S.
    Bermuda Yes, if incorporated in the U.S.
    Belgium Yes, if the competent authorities so agree
    Bulgaria Yes, if the competent authorities so agree
    Canada Yes, unless the company is incorporated in both the U.S. and Canada. See (13) above.
    China Yes, if the competent authorities so agree. However, if U.S. corp. is a DRC, not with China but with a country that has a treaty with China, no benefits allowed.
    Czech Republic Yes, if incorporated in the U.S.
    Denmark Yes, if the competent authorities so agree
    Estonia Yes, if the competent authorities so agree
    Finland Yes, if the competent authorities so agree
    France Yes, if the competent authorities so agree
    Germany Yes, if the competent authorities so agree
    Hungary Yes, if incorporated in the U.S.
    Iceland Yes, if the competent authorities so agree
    India No, never entitled to benefits from the other country
    Indonesia Yes, if incorporated in the U.S.
    Ireland Yes, if the competent authorities so agree
    Israel Yes, if the competent authorities so agree
    Italy Yes, if the competent authorities so agree
    Jamaica No, never entitled to benefits from the other country
    Japan Yes, if the competent authorities so agree
    Kazakhstan Yes, if the competent authorities so agree
    Latvia Yes, if the competent authorities so agree
    Lithuania Yes, if the competent authorities so agree
    Luxembourg Yes, if the competent authorities so agree
    Malta Yes, if incorporated in the U.S.
    Mexico No, never entitled to benefits
    Morocco Yes, if the competent authorities so agree
    Netherlands Yes, if the competent authorities so agree
    New Zealand Yes, if the competent authorities so agree
    Pakistan No, never entitled to benefits
    Portugal Yes, if the competent authorities so agree
    Russian Federation Yes, if the competent authorities so agree
    Slovak Republic Yes, if incorporated in the U.S.
    Slovenia Yes, unless the company is incorporated in both the U.S. and Slovenia, and then only if the competent authorities agree
    S. Africa Yes, if incorporated in the U.S.
    Spain Yes, if the competent authorities so agree
    Switzerland Yes, if the competent authorities so agree
    Thailand Yes, if the competent authorities so agree
    Tunisia Yes, if the competent authorities so agree
    Turkey Yes, if incorporated in the U.S.
    Ukraine Yes, if the competent authorities so agree
    United Kingdom Yes, if the competent authorities so agree
    Venezuela Yes, if the competent authorities so agree

    Note:

    Treaty Benefits may be granted for all other countries, if incorporated within the U.S.

  15. Dual resident corporations that are only entitled to treaty benefits if the competent authorities agree, must have obtained this mutual agreement using Rev. Proc. 2015-40 prior to seeking U.S. residency certification. Applicants that have copies of the mutual agreement reached on their corporations, must submit a copy with their application.

    1. When a copy of the mutual agreement is submitted along with the application, take the necessary steps to issue certification.

    2. When the applicant does not have a copy of a mutual agreement attached, reject using Letter 3644.

  16. Dual resident corporations that are never entitled to treaty benefits in their other country of residence must be denied certification.

  17. DRCs requesting certification for China are not entitled to treaty benefits if it is a Dual Resident Corporation in a country that has a treaty with China. The following countries have treaties with China:

    • Albania

    • Algeria

    • Armenia

    • Australia

    • Austria

    • Azerbaijan

    • Bahrain

    • Bangladesh

    • Barbados

    • Belarus

    • Belgium

    • Bosnia and Herzegovina

    • Brazil

    • Brunei

    • Bulgaria

    • Canada

    • Chile

    • Croatia

    • Cuba

    • Cyprus

    • Czech Republic

    • Denmark

    • Ecuador

    • Egypt

    • Estonia

    • Ethiopia

    • Finland

    • France

    • Georgia

    • Germany

    • Greece

    • Hong Kong

    • Hungary

    • Iceland

    • India

    • Indonesia

    • Iran

    • Ireland

    • Israel

    • Italy

    • Jamaica

    • Japan

    • Kazakhstan

    • Korea

    • Kuwait

    • Kyrgyzstan

    • Laos

    • Latvia

    • Lithuania

    • Luxembourg

    • Macau

    • Macedonia

    • Malaysia

    • Malta

    • Mauritius

    • Mexico

    • Moldova

    • Mongolia

    • Morocco

    • Nepal

    • Netherlands

    • New Zealand

    • Nigeria

    • Norway

    • Oman

    • Pakistan

    • Papua New Guinea

    • Philippines

    • Poland

    • Portugal

    • Qatar

    • Romania

    • Russia

    • Saudi Arabia

    • Serbia and Montenegro

    • Seychelles

    • Singapore

    • Slovak Republic

    • Slovenia

    • South Africa

    • Spain

    • Sri Lanka

    • Sudan

    • Sweden

    • Switzerland

    • Syria

    • Tajikistan

    • Thailand

    • Trinidad and Tobago

    • Tunisia

    • Turkey

    • Turkmenistan

    • Ukraine

    • United Arab Emirates

    • United Kingdom

    • Uzbekistan

    • Venezuela

    • Vietnam

    • Zambia

    • Zimbabwe

  18. A DRC that requests certification for China and indicates on Form 8802, line 4e, a dual residence with one of the countries listed in IRM 21.8.4.7.12.3 (17) above, must be denied certification. According to the China treaty, the corporation is not entitled to treaty benefits.

  19. Use the following chart to work status codes 500, 508, 509, 513 or 514:

    If Then
    Status Code 500 Verify that there are no input errors, correct accordingly. If correction reveals 1120-01 and return filed, issue certification.
    No input errors and taxpayer filed a 1120F or 1120FSC Reject application.
    Status Code 508 Verify that the correct tax year was entered, correct accordingly.
    Correct tax year entered Reject the certification, No return filed.
    Status Code 509 Verify, using Form 8802, that the correct tax year was entered, correct accordingly.
    Correct tax year entered Check IDRS for different tax year ending, correct accordingly.
    Tax period ending corrected and return located Issue certification, using one of the corporate paragraphs:

    COR.1120.XX.
    Status Code 513 Verify that there are no input errors, correct accordingly. If correction reveals 1120-01 and return filed, issue certification using one of the corporate paragraphs:

    COR.1120.XX.
    No input errors and taxpayer filing requirement is a 1120-06 or 1120-15 Reject application.
    Status Code 514 Verify that there are no input errors. If error identified and the correction reveals 1120-01 and return filed, issue certification using one of the corporate paragraphs:

    COR.1120.XX.
    No input errors and taxpayer filing requirement is a 1120-14 and/or a TC590-14 posted on module Follow instructions for processing a Corporate Subsidiary applicant. Continue processing using the procedures in the next section.
  20. Once the applicant has met the requirements specified for a U.S. corporation and the residency has been verified, issue the certification. When the applicant is a subsidiary, see IRM 21.8.4.7.12.4, Corporate Subsidiary Applicants.

  21. U.S. corporations that have applied for an extension of time to file are qualified to receive certification. If the extension cannot be verified, do not certify the corporation.

    1. Verify a fact of filing for the prior year tax return.

    2. Obtain the extended due date from the applicant's account or a copy of the approved extension.

    3. After verifying the previous filing and obtaining the extended due date, issue the certification using one of the corporate paragraphs:

      COR.1120
      COR.1120.SP
      COR.1120.GR
      COR.1120.RS

  22. When the U.S. corporation indicates that it is newly formed and the corporation has not yet been required to file a tax return, use the letter 3444 to request a copy of its corporate charter in lieu of the tax return.

    1. When a copy of the charter is received, verify that the corporation is a domestic corporation (incorporated in the United States); if so, issue certification.

    2. If the applicant fails to provide a copy of the corporate charter within 30 days (60 days if overseas), close as a no reply.

  23. When IDRS indicates that the account has not been established:

    1. Using the letter 3444, request a copy of the corporate charter.

    2. Follow local procedures for establishing the account, when charter is received (forward to Entity using a Form 4442).

    3. Once notified by Entity that the account is established, issue certification.

    4. If the applicant fails to provide a copy of the corporate charter within 30 days (60 days if overseas), close as a no reply.

  24. Foreign Corporations and Foreign Sales Corporations are not entitled to treaty benefits. These forms can be identified on IDRS by the tax class of "3" and a document code of 66, 67, 69 or 07.

  25. Any Corporation that has had its application declined or certification rejected, but believes it is entitled to treaty benefits under a specific treaty article, should follow Rev. Proc. 2015-40 to request Competent Authority assistance.

Corporate Subsidiary Applicants
  1. A U.S. corporation that is a subsidiary of another corporation may be a member of a consolidated group. A corporation that is a subsidiary of another corporation is included in that corporation's consolidated return.

    1. The subsidiary is an affiliate defined in IRC §1504 (i.e., child) of the corporation.

    2. The corporation that is liable for filing the corporate tax return is the common parent corporation.

    3. The consolidated return, Form 1120, is required to be filed by the common parent corporation.

    4. The consolidated return is the tax return which includes the information pertaining to the parent and all of its affiliates' (subsidiaries’) information.

  2. A corporate subsidiary applicant that filed a Form 1120F, generally is not entitled to U.S. Residency Certification. If the subsidiary filed Form 1120F, and believes it is entitled to U.S. Residency Certification under a specific treaty article, refer the applicant to Rev. Proc. 2015-40.

  3. A corporate subsidiary applicant that has a filing requirement of Form 1120F, is not entitled to U.S. Residency Certification. Issue letter 4057.

    1. If the applicant claims during a telephone conversation the filing requirement is incorrect, refer to Customer Service at 1-800-829-4933.

    2. If the applicant submits correspondence stating the filing requirement is incorrect, forward to Entity to request a Filing requirement determination using Form 4442.

    3. If filing requirement is corrected, issue certification.

  4. A corporate subsidiary applicant's Form 8802 must include:

    • Application Information (Name of applicant for which certification is being requested)

    • Applicant's TIN, EIN (the subsidiary)

    • Mailing Address (if other than applicant's address)

    • Permanent Residence Address (when applicable)

    • Parent Corporation, Entity information

    • Parent Corporation's EIN

    • Entity Type must be corporate

    • Tax Form Filed

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax period

    • Certification Type

    • Country and number of certifications requested

    • TIA (when applicable)

    • Penalty of Perjury statements (when applicable)

    • A signature and date

    • A signed copy of page one of the consolidated return filed

    • A copy of Schedule 851, Affiliation Schedule

    Note:

    Form 1120F filer must provide a detailed explanation, including documentary evidence, as to why it believes it is entitled to certification.

  5. If the application is for a corporate subsidiary, and the applicant failed to supply a copy of the consolidated return and/or the Schedule 851, research the corporate subsidiary's entity and tax module to verify that the applicant is recognized as a subsidiary by IRS.

    1. Form 1120-14 filing requirement on the corporate subsidiary's entity indicates the entity is a subsidiary. The x-ref TIN should be that of the parent corporation.

    2. A Transaction Code 590-14 in the subsidiary's tax module indicates that the subsidiary's 851 schedule was filed with the parent return, or that it has been verified as a subsidiary under the common parent corporation. The x-ref TIN should be that of the parent corporation.

      Note:

      Do not correspond for the consolidated return when verification of a Form 1120-14 filing requirement on the subsidiary's entity is completed, and/or a transaction code 590-14 on the subsidiary's tax module, and the TIN of the parent corporation, unless the subsidiary files a Form 1120F.

  6. Once verification that the entity is a subsidiary corporation is completed, verify the common parent corporation has filed its required return.

  7. Begin entering the Form 6166 application information when all required information has been verified. See Form 8802 lines in (3) above.

  8. In addition to inputting the other required fields specified in IRM 21.8.4.7.12.3, the following must be completed:

    1. Enter the TIN of the subsidiary, from Form 8802, in the primary TIN field.

    2. Enter the form filed, from Form 8802, in the Form field.

    3. Enter the subsidiary's name, from Form 8802, in the Applicant Entity field.

    4. Enter the subsidiary's Name Control, from Form 8802, in the Name Control field.

  9. Use the chart below to work status codes 103, 508, 509, and 514.

    If Then
    Status Code 103 Check for input errors. Verify that the Form 8802 information was entered according to (3) above.
    Corrections made and parent filed as required Issue certification using one of the corporate paragraphs:

    COR.1120.XX.
    Corrections cannot be made based upon Form 8802 (no input errors) Check CC ENMOD or BMFOL, correct accordingly.
    If no errors found on Form and IDRS does not provide assistance Certification cannot be issued.
    Status Code 508 Verify that the TIN and tax year were entered correctly. See (7) above, correct accordingly.
    TIN and Tax year entered correctly Check the application attachments for a copy of page one of the Parent company's Form 1120 and the 851 schedule for the subsidiary.
    The Parent company's Form 1120 and the 851 schedule for the subsidiary are attached Research for the posting of the return, TC 150 on IDRS.
    The return is posted Issue certification in the name of the subsidiary using one of the corporate paragraphs:

    COR.1120.XX.
    No return posted Suspend certification application with letter 3444.
    Status 509 Verify, using Form 8802, that the correct TIN and tax year were entered, correct accordingly. Issue certification when return located using one of the corporate paragraphs:

    COR.1120.XX.
    Correct TIN and tax year entered Check IDRS for different tax year ending, correct accordingly.
    Tax period ending corrected and return located Override status 509, issue certification.
    Status 514 Check IDRS and/or the application attachments for the subsidiary's parent information.
    Parent Name and TIN are located Research for the posting of the return, TC 150 on IDRS.
    The return is posted Issue certification in the name of the subsidiary.
    No return posted Suspend certification application with letter 3444C.
  10. When all of the required information has been received and entered, and the system has verified that the common parent corporation has filed its required return, validate (099) status. Otherwise, manually verify the filing of the parent return and issue the certification. Issue certification using one of the corporate paragraphs:

    • COR.1120

    • COR.1120.SP

    • COR.1120.GR

    • COR.1120.RS

  11. When the common parent corporation failed to file its required return, issue Letter 3444.

    1. When the response to Letter 3444 indicates that the corporation is a newly established entity and the Corporate Charter is provided, issue Certification Form 6166.

    2. When the applicant fails to provide the required information within 30 days (60 days overseas), close the application as a no reply.

      Note:

      All correspondence is auto closed 60 days after the letter issue date or status date, whichever is later.

  12. Any subsidiary corporation that has had its application declined, but believes it is entitled to U.S. Residency Certification, must submit a copy of its completed Form 8802, attach a detailed explanation and/or regulation or Code section, including documentary evidence, as to why it believes it is entitled to certification.

    1. Place the case in status 702.

    2. Notate in Remarks Section that the case is being forwarded to HQ via Planning and Analysis.

    3. Forward all applications and attachments to HQ via Planning and Analysis.

  13. Any subsidiary corporation that has had its application declined or certification rejected, but believes it is entitled to treaty benefits under a specific treaty article, must follow Rev. Proc. 2015-40 to request Competent Authority assistance.

Subchapter S Corporation Applicants
  1. Pursuant to IRC § 1362(a) and (b), an eligible corporation may elect to be an S Corporation by the filing and acceptance of Form 2553, Election by a Small Business Corporation. S Corporations are required to file a Form 1120S, U.S. Income Tax Return for an S Corporation. The filing requirements on 1120S filers' entity modules are shown as 1120-02 on CC INOLE or ENMOD.

  2. The maximum number of shareholders in a Subchapter S Corporation depends on the tax year in question.

    Note:

    Individuals that are married and filing jointly are counted as one shareholder, although issued individual K-1s. The shareholders are limited to:

    • Individuals

    • Estates

    • Certain Exempt organizations

    • Trusts

      Note:

      There cannot be any nonresident alien shareholders or other foreign person as a shareholder.

  3. In tax years prior to 2004, Subchapter S Corporations that had more than 75 shareholders were considered in violation of their S election.

    Exception:

    Subchapter S Corporation that had over 75 shareholders due to having shareholders that are married.

  4. In tax years beginning after 2004, Subchapter S Corporations that have more than 100 shareholders may be in violation of their S election.

    If Then
    S Corp. application indicates more than 100 shareholders Verify that the overflow is not due to shareholders that are married.
    Count all shareholders that are married as one and there are still have more than 100 shareholders Forward a copy of the case, Certification Application and shareholders list to Examination Classification indicating taxpayer may be in violation of S election (more than 100 shareholders).
  5. An S corporation, although incorporated in the U.S., is not taxable by the U.S. at the entity (corporate) level (S Corp. level) on its worldwide income.

    • S Corporations are not considered residents within the meaning of the residence article of U.S. income tax treaties.

    • The corporate income, whether or not distributed, is taxed to the shareholders under a pass-through approach based largely on the partnership model.

    • Shareholders within the S Corporation are taxed on their respective shares of the income of the S Corp.

  6. Based upon the facts listed in paragraph (4) above, the certification issued to an S corporation is not similar to certifications issued to a C corporation (1120 filer).

    • Certifications of residency are issued at the shareholders' level.

    • Shareholders are certified based upon the shareholders having filed the tax forms for which they are liable.

  7. A requestor (this includes shareholders within the S Corporation) of a Subchapter S corporation certification must have written authorization from each shareholder to receive the requested certification information. Approved authorizations include:

    • Form 8802, Line 3b

    • Form 8821, Tax Information Authorization, or like statement

    • Form 2848, Power of Attorney and Declaration of Representative

      Note:

      The authorizations must authorize the 3rd party requestor to receive their individual tax information.

      Note:

      A Form 8821 is not required for a sole shareholder that provides a valid Penalties of Perjury statement on Form 8802, Line 10, a third party named on Form 8802, Line 3b, and the Form 8802 is signed by the sole shareholder.

  8. A requestor, if other than a shareholder of the S Corporation during the tax year for which certification is requested, must have written authorization to receive the S Corporation's tax information from a corporate officer with legal authority to bind the S Corporation.

  9. The S Corporation's Form 8802 application must include:

    • Application Information (Name of S corporation)

    • Applicant's TIN

    • Mailing Address (if other than applicant's address)

    • TIA (when applicable)

    • Permanent Residence Address (when applicable)

    • Entity Type

    • Tax Form Filed

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax period

    • Certification Type

    • Country and number of certifications requested

    • A declaration statement or penalties of perjurystatement (when applicable)

    • A signature of corporate officer or the Corporation's POA and date

    • A list of the shareholders to be certified and authorization from each shareholder to release the certification information to the requestor (F2848 or F8821)

      Note:

      This field is not required for VAT certifications.

    • Authorization from a corporate officer or the corporation's POA to release the corporate tax information, when the certification is being released to someone other than a corporate officer, POA or shareholder in the S Corporation.

  10. Subchapter S Corporations that need current year certification must include:

    • Application Information (Name of S corporation for which certification is being requested)

    • Applicant's TIN

    • Mailing Address (if other than the applicant's address)

    • TIA (when applicable)

    • Permanent Residence Address (when applicable)

    • Entity Type must be Corporate

    • Tax form filed

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax period

    • Certification Type

    • Country and number of certifications requested

    • Penalty of perjury statements or a declaration statement (when applicable)

    • A signature on Form 8802 of a corporate officer with legal authority to bind the corporation or the corporation's POA and a date

    • Written authorization from each shareholder to release the certification information to the requestor Form 2848 or Form 8821)

    • A penalties of perjury statement from each individual shareholder or the shareholder's authorized representative (POA) stating that the shareholder is a U.S. Resident and will remain so throughout the current tax year, and

    • A statement under penalties of perjury from the corporate officer

      Note:

      The declaration statement sample is provided in (11) below.

    • Authorization from a corporate officer or the Corporation's POA to release the corporate tax information, when the certification is being released to someone other than a corporate officer, POA or shareholder in the S Corporation

  11. Current year Corporate applications must include a statement from an officer with legal authority to bind the corporation stating under penalties of perjury:

    "XXX corporation, EIN is an S Corporation, its entity classification has not changed since it filed its return, and it is a United States Corporation and shall remain so through the current tax year."

    Note:

    When the prior year return has not been filed and isn’t yet required, the declaration must address the Applicant’s residency status in the prior year as well as in the current year.

  12. If the requestor failed to provide the required information, suspend the case and contact the requestor for the missing information using the letter 3441, or by telephone.

    1. When the applicant responds with requested information, continue processing the application.

    2. If the applicant was contacted by phone, allow 5 days for response. If no reply, issue letter 3441.

    3. If the applicant fails to provide the required information within 30 days (60 days overseas), close the certification case as a no reply.

  13. Certification of a S corporation requires:

    1. The filing of a Form 1120S

    2. Tax disclosure authorization for the requestor from each shareholder

    3. Tax disclosure authorization from an officer with legal authority to bind the corporation

    4. A shareholders list attached to the certification application in which each shareholder listed must have filed their required U.S. income tax return/extension as a resident of the U.S.

    5. A penalties of perjury statement from each shareholder listed on the shareholders list attached to the certification, as well as a penalties of perjury statement from an officer with legal authority to bind the corporation.

  14. In addition to using the procedures in this section for working S Corp. status codes, use the chart below for a quick reference to working status codes 515, 520, 521 and 522.

    If Then
    Status Code 515 Check for input errors. Verify, using Form 8802, the type of certification application.
    Application is for VAT, not Income Tax and the required return is filed Check the VAT indicator and override 515; issue certification using the paragraph:

    SCO,1120S.VAT.
    No input errors Follow procedures for securing Shareholder List.
    Status Code 520 Check for input errors. Verify Shareholder's Name and TIN using Shareholders list, correct accordingly.
    If no input errors or corrections made, but one or more shareholder failed to file his or her tax return Override 520, issue certification with list of shareholders that filed the required returns. Certification will be issued using one of the paragraphs in the SCO.1120S series.
    Status Code 522 Check for input errors. Verify shareholder's Name and TIN using Shareholders list, correct accordingly.
    No input errors and one or more shareholders file a Form 1040NR DO NOT ISSUE certification. Follow instruction in IRM 21.8.2, BMF International Adjustments, for notifying Examination of a possible violation of Form 2553 election.
  15. Issue the standard 1120S certification, when the S corporation and all of its shareholders have:

    1. Filed their required returns

    2. Provided tax disclosure authorization for the requestors

    3. Provided penalties of perjury statements for current year applications

      Note:

      Verify penalties of perjury and check the POP indicator box for each shareholder that submitted the required statement.

  16. If one or more of the shareholders failed to file their required return, issue the 1120S Certification with a list indicating which shareholders have filed.

  17. When all of the shareholders on the S Corporation failed to file their required individual tax return or extension, reject the S Corporation application. Issue letter 4060C.

  18. If any one of the shareholders on the S Corporation failed to file or filed an individual tax return claiming a foreign tax home (Form 2555 exclusion), that shareholder must be excluded from the certification list (see exception). Issue certification with a list of the shareholders that filed as U.S. residents.

    Exception:

    The certification country is Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine, and the foreign tax home country is one of the above-named countries, but not the same country.

  19. If none of the shareholders filed, there are more than 100 shareholders, or any one of the shareholders filed their individual tax returns as a non-resident:

    1. Reject the 1120S certification application; issue letter 3442.

    2. Attach to the copy of the application a current transcript (TXMODA, or BMFOLT) for the tax year and TIN of all modules involved. Be sure to notate that the attached 1120S filer is in violation of their 2553 election.

    3. Forward the case to Examination for Classification.

  20. Any S Corporation that has had its application declined, but believes it is entitled to U.S. Residency Certification, must submit a copy of the completed Form 8802, attach a detailed explanation and/or regulation or code section, including documentary evidence, as to why it believes it is entitled to certification.

    1. Place the case in status 702.

    2. Forward all applications and attachments to HQ via Planning and Analysis.

  21. Any S Corporation that has had its application declined or certification rejected, but believes it is entitled to treaty benefits under a specific treaty article, must follow Rev. Proc. 2015-40 to request Competent Authority assistance.

Qualified Subchapter S Subsidiary Applicants
  1. A Qualified Subchapter S Subsidiary (Q-Sub) is a domestic corporation whose stock is 100% owned by its parent S corporation.

  2. IRC § 1361 permits S Corporations to elect to own a qualified Subchapter S subsidiary. Form 8869, Qualified Subchapter S Subsidiary Election, is used to make this election.

  3. When the IRS accepts a Q-Sub election, the Qualified Subchapter S Subsidiary is deemed liquidated into the parent S Corporation. If the Q-Sub was a separate corporation, it is no longer treated as such. The Q-Sub is a disregarded entity upon acceptance of the election and is not treated as a subsidiary of a corporation. That is to say, it is not recognized as a separate entity.

  4. Approved Form 8869, Qualified Subchapter S Subsidiary Election, will have a transaction code 082 on the entity module.

  5. Q-Sub Form 8802, Application for United States Residency Certification must include:

    • Application Information (the Q-Sub information)

    • Applicant's TIN, EIN of the Q-Sub (if applicable)

    • Mailing Address (if other than applicant's address)

    • TIA (if applicable)

    • Permanent Residence Address (when applicable)

    • Parent S Corporation, Entity information must be entered in Applicant Entity field.

    • Parent S Corporation's EIN (Enter this EIN in the Primary TIN field when entering Form 8802 in 6166 database.)

    • Entity Type

    • Tax Form filed by parent organization

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax period

    • Certification Type

    • Country and number of certifications requested

    • TIA (when applicable)

    • Penalty of Perjury statements (when applicable)

    • A signature and date

    • Acceptable proof of an approved 8869 election

    • A list of the shareholders within the Parent S Corporation for which certification is requested and written authorization (Form 2848 or Form 8821) from each individual shareholder authorizing the release of their individual tax information

    • Authorization from a corporate officer or the corporation's POA to release the corporate tax information, when the certification is being released to someone other than a corporate officer, POA, or shareholder in the S Corporation

  6. When the Q-Sub application is complete and includes acceptable proof of its Q-Sub status:

    1. Enter the Parent S Corporation's TIN in the primary TIN field.

    2. Enter the Q-Sub TIN in the Secondary TIN field.

    3. Enter the Q-Sub's entity information in the Applicant Information field.

    4. Enter the Q-Sub's parent's name control in the Name Control field.

    5. Enter all of other required information.

      Reminder:

      Be sure to check the QSSS verified box, once you have acceptable proof of the Q-Sub status.

  7. Acceptable proof of an approved Form 8869:

    • A transaction 082 on the module of the parent S corp and/or a TC590 -13 or 14 on the Q-Sub's module

    • A Form 8869 with an approved or accepted stamp

    • An IRS letter stating that Form 8869 has been accepted

      Note:

      IRS will notify the corporation, usually within 60 days after the Form 8869 is filed, that the Q-Sub election is accepted and when it will take effect, or if it is not accepted.

  8. When an applicant submits an approved 8869 but a TC 082 is not posted on the Q-Sub's parent's account:

    1. Process the certification application as if a TC 082 were located.

    2. Once the certification process is complete, using the Form 4442, forward the approved 8869 to Entity application to have the TC 082 placed on the parent's module.

  9. When an applicant submits a Form 966, Corporate Dissolution or Liquidation, filed in 2001 or prior, and claims that the previous corporation is now a subsidiary of an S Corporation (a Q-Sub), but a TC 082 cannot be located:

    1. Forward a copy of the Form 966 to Entity for determination, using the Form 4442.

    2. Request that Entity review the case and determine if the applicant would be considered a Q-Sub.

  10. Once Entity has reviewed the case and made the determination, process your case accordingly.

    IF THEN
    TC082 is placed on the parent's module Process as a Q-Sub.
    The determination is not favorable Reject the application.
    If Form 8869 is requested Suspend application.
  11. Requestors that fail to provide the required information in (5) above must be corresponded with using letter 3441, or letter 3536, or by telephone.

    1. When the applicant responds with requested information, continue with (6) above.

    2. If the applicant was contacted by phone, allow 5 days for response. If no reply, issue 3441.

    3. If the applicant fails to provide the required information within 30 days (60 days overseas), close the certification case as a no reply.

  12. Certification of a Qualified Subchapter S Subsidiary requires the following verification:

    1. Proof that the Form 8869 election was accepted and approved by the IRS

    2. Filing of an S Corporation return by the Parent S Corporation

    3. Verification that all shareholders on the Parent S Corporation have provided written authorization that the requestor can receive their tax information

    4. Verification that every shareholder listed on the S Corporation's certification filed their required U.S. income tax return/extension as a resident of the U.S.

  13. When all shareholders in the parent S corporation have filed their required returns, issue the standard Q-Sub certification paragraph.

  14. When one or more of the shareholders in the parent S Corporation failed to file the required return, or failed to provide a tax information disclosure authorization, issue the Q-Sub paragraph with the parent S corporation list indicating which shareholders have filed.

  15. When all of the shareholders on the Parent S Corp. failed to file the required individual tax return or extension, reject the Q-Sub application using Letter 4060.

  16. If any one of the shareholders on the Parent S Corp. failed to file, or filed the individual tax returns claiming a foreign tax home (Form 2555 exclusion), issue certification with a list of the shareholders that filed Form 1040 as a U.S. resident.

    Exception:

    The certification country exceptions are Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine. This exception only applies if the certification country is one of the countries listed above and the country of residence is not the same country.

  17. If any one of the shareholders on the Parent S Corp. filed an individual tax return as a non-resident (Form 1040NR):

    1. Reject the Q-Sub certification application.

    2. Attach to the copy of the application a current transcript (TXMODA, IMFOLT or BMFOLT) for the tax year and TIN of all modules involved. Annotate that the attached 1120S filer appears to be in violation of its 2553 election.

    3. Forward the case to Examination for Classification.

  18. Working status codes for Q-Sub Applicants:

    If Then
    Status Code 103 Check for input errors, verify that application information was entered according to (6) above. Correct accordingly.
    Compare the Form 8802 to the input screen and IDRS and corrections can be made, the parent S Corp. filed, and all shareholders valid Make all corrections and issue certification.
    Compare the Form 8802 to the input screen and IDRS and No errors can be found; no correction can be made The Q-Sub cannot be certified.
    Status Code 515 Verify that the application isn't for VAT.
    VAT Application Check VAT indicator and process VAT Certification.
    Application is not for VAT Reject the Q-Sub application using the instructions. See IRM 21.8.4.7.12.5, Subchapter S Corporation Applicants.
    Status Code 522 Verify that the shareholder TIN is correct and that a 1040NR was truly filed.
    Shareholder(s) filed a Form 1040NR Reject the Q-Sub application using instructions. See IRM 21.8.4.7.12.5, Subchapter S Corporation Applicants.
  19. Any Q-Sub Applicant that has had its application declined, but believes it is entitled to U.S. Residency Certification, should submit a copy of its completed Form 8802, attach a detailed explanation and/or regulation or Code section, including documentary evidence, as to why it believes it is entitled to certification.

    1. Place the case in status 702, and

    2. Forward all applications and attachments to HQ via Planning and Analysis.

  20. Any Q-Sub that has had its application declined or certification rejected, but believes it is entitled to treaty benefits under a specific treaty article, must follow Rev. Proc. 2015-40 to request Competent Authority assistance.

Partnership Applicants
  1. Partnerships are not considered U.S. residents within the meaning of the residence article of U.S. income tax treaties. Treaty benefits are only available to partners within a partnership, not the partnership.

  2. U.S. Partnerships are generally required to file a Form 1065, U.S. Return of Partnership Income. Certification of partnerships generally require:

    1. The filing of a Form 1065

    2. Tax disclosure authorization from the tax matters partner for the partnership when the requestor is not a partner within the partnership for the tax year for which certification is requested

    3. Tax disclosure authorization for the requestor from each partner

    4. Each partner or entity listed as an attachment to the partnership certification application must have filed a U.S. Individual Tax Return or an extension as a resident of the U.S.

      Caution:

      When a flow-through entity is listed as a partner within the partnership listing, secure a listing and the tax disclosure authorizations of the individuals or entities within that flow-through entity and add them to the Tier II listing of the partnership record.

    5. A penalties of perjury statement from the partnership and each partner listed on the partnership list or return must be verified and the penalties of perjury indicator checked for each partner, when a current year application is requested.

      Caution:

      When a flow-through entity is listed as a partner within the partnership listing, secure a list of the individuals/entities within that flow-through entity and secure penalties of perjury statements from them.

  3. Partnership Certification Application requires completion of:

    • Application Information (Name of partnership for which application is being requested)

    • Applicant's TIN

    • Mailing Address (if other than applicant's address)

    • Permanent Residence Address (when applicable)

    • TIA (when applicable)

    • Entity Type and of partners in the partnership, and

    • Tax form filed

      Exception:

      Partnerships that are not required to file Form 1065 under IRC § 761 or Treasury Regulation 1.6031(a)-1(b) will not enter a Form 1065 but should indicate not required under IRC § 761 or Treasury Regulation 1.6031(a)-1(b).

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax period

    • Certification Type

    • Country and number of certifications requested

    • A declaration statement or penalties of perjury statements (when applicable)

    • Form 8802 must contain a signature of tax matters partner or the Partnership's POA and a date, when it is a third party application

    • A Partners list identifying the name, TIN, and form filed

    • Written authorization from each partner to release the certification information to the requestor (Form 2848 or Form 8821)

    • A penalties of perjury statement from the partnership and each individual partner listed on the partnership certification application for current year certifications

    Note:

    Nominee Partnerships are not required to check the partnership box, file a Form 1065, or provide the Nominee partnership list, but they are required to check the nominee box and provide a list of the individuals or entities for which the nominee is an agent/representative.

  4. When none of the partners filed the required tax return or extension, reject the partnership application.

  5. If any one of the partners in the partnership failed to file, failed to provide tax disclosure authorization, filed as a non-resident, or filed an individual tax return claiming a foreign tax home (Form 2555 filed, see exception), issue certification with a list of the partners that filed as a U.S. resident.

    Exception:

    The Form 2555 certification exception countries are Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, and Ukraine and the foreign tax home country is not the same country for which certification is requested; Form 2555 was not filed by the requestor (it belongs to the spouse) or is a part of a dual status return.

  6. Current Year Partnership Applications, in addition to the requirements listed in paragraph (2) above, must include:

    1. A statement from the tax matters partner that the partnership entity's classification has not changed since it filed its required return for the previous year

    2. A list of the current partners, identifying all new partners

      Note:

      When entering the partnership list, DO NOT check the POP indicator box UNTIL you have verified receipt of a POP statement.

    3. A penalties of perjury statement from each partner or partner's authorized representative (POA) requesting certification indicating that the partner is a resident of the United States of America for purposes of U.S. taxation and will remain so throughout the current calendar year

  7. A requestor (this includes partners within the partnership) of a partnership certification must have written authorization from each partner to receive the partner's tax information for certification. Requestors that are not a partner in the partnership must also secure authorization from the tax matters partner to receive the Partnership's certification information.

    Note:

    When a flow-through entity is listed as a partner within a partnership listing, secure written authorization from the individuals/entities listed within the second Tier, third Tier, etc. When second or third tier entities do not provide the required list or authorizations, the entity (second or third tier) must not be listed as a partner on the certification.

  8. The forms used to secure tax disclosure authorization are:

    1. Form 8821, Tax Information Authorization, or

    2. Form 2848, Power of Attorney and Declaration of Representative, from each partner before an application can be certified. (See IRM 21.3.7.8., Processing Third Party Authorizations onto the Centralized Authorization File(CAF), International Processing, for additional instructions.)

  9. Use the chart below to work status codes 091, 520, 521 and 522/322:

    If Then
    Status Code 091 Check for input errors. Verify the type of certification application using Form 8802.
    Application is for VAT, not Income Tax, and the partnership filed its required return Check the VAT indicator and issue certification.
    No input errors Follow procedures for securing Partnership List.
    Status Code 520 Check for input errors. Verify partner's name and TIN using Partnership list, correct accordingly.
    No input errors or corrections made, but one or more partners failed to file their return and the partnership filed its required return or was not required to file Issue certification with list of partners that filed their required returns.
    No input errors or corrections made, but one or more partners still invalid and the partnership filed its required return or was not required to file Issue certification with list of partners that filed their required returns.
    Status Code 522/322 Check for input errors. Verify partner's name and TIN, using the partners list, correct accordingly.
    The partnership filed its required return or was not required to file, there are no input errors, but one or more partners filed a Form 1040NR Issue certification with list of partners that filed as U.S. residents.
  10. When the Partnership applicant has met all requirements, issue Form 6166.

  11. When the applicant doesn't provide the required information, request the information using Letter 3429 or Letter 3536.

    1. If applicant responds with the required information, and all requirements have been met, see paragraphs 1–3; issue certification Form 6166.

    2. If applicant fails to provide the required information within 30 days (60 days overseas), close the application as a No Reply.

  12. Advise any Partnership Applicant that has had its application declined, but believes it is entitled to treaty benefits under a specific treaty article, to follow Rev. Proc. 2015-40 to request Competent Authority assistance.

IRC § 761 Partnerships
  1. IRC § 761 Partnerships include syndicates, groups, pools, joint ventures, or other unincorporated organizations through which business, financial operations, or ventures are carried out.

  2. Certain partnerships under IRC § 761 (with the agreement of all of their members) may elect to opt out of filing Form 1065, if the income of the members of the organization can adequately be determined without the computation of the partnership taxable income.

  3. IRS' Examination Division will approve the partner's election to be excluded from filing a Form 1065, provided the member's/partner's shares of income can adequately be determined without the computation of a partnership return.

  4. An election is generally requested with the filing of the Partnership's initial return. However, an election via the initial return is not required when all partners agreed (via partnership agreement) to the IRC § 761 election and the income of the partners can adequately be determined without the computation of a partnership return.

  5. Partnership applicants that are not required to file Form 1065 under IRC § 761 are required to provide:

    1. A list (name, TIN and type of form filed) identifying those partners from the IRC § 761 election statement that are requesting U.S. Residency certification

    2. The name, TIN and type of form filed of any partner, not identified on the original election but currently included in the partnership and requesting a U.S. residency certification, submitted under penalties of perjury

    3. Form 8821 or like statements from all partners authorizing the applicant or third party to receive their individual tax information

    4. Written authorization from the tax matters partner to receive the Partnership's certification information when the requestor is other than a partner within the partnership during the year for which certification is requested

    5. A current year POP from all current partners, if current year application

    6. A copy of the IRC § 761 election or penalties of perjury statement. See (6) below.

    Note:

    When a Partnership is listed as a partner within a partnership listing, secure written authorization from the partners listed within the Tier 2 partnership, Tier 3, etc.

  6. The copy of the election or a statement under penalties of perjury from the tax matters partner should state:

    "The partnership XXXXXX, EIN has made an election pursuant to IRC § 761. As a result, it is not required to file Form 1065, U.S. Return of Partnership Income, on an annual basis and all of its members report their respective shares of income, deductions, and credits on their tax returns as required. "

  7. IRC § 761 electing partnerships , in addition to meeting the requirements in this section, must meet all the requirements of a partnership applicant with the exception of having to file Form 1065.

  8. When the partnership has met all of the application requirements for an IRC § 761 case, complete the following:

    1. Enter all standard information.

    2. Check the IRC § 761 checkbox.

    3. Leave the Tax Form box blank.

    4. Check the "Not Required" checkbox.

    5. Enter the partners list.

  9. Once all of the steps in (8) are complete, the case must be saved. The partnership generates a 091 status and the individual partners generate a 600 status.

  10. The partnership will not go through the automated IDRS system.

  11. When one or more of the partners are U.S. residents:

    1. Override the status 091 to status 099.

    2. Issue the certification with the list identifying the U.S. partners.

    3. Use one of the paragraphs in the PTR.IRC761 series.

  12. When none of the partners are U.S. residents, reject the application using Letter 3443.

Foreign Partnerships
  1. Foreign Partnerships, including LLCs that are considered foreign partnerships, generally are not required to file Form 1065 if they do not derive effectively connected income or U.S. sourced fixed determinable and periodic (FDAP) income. See Treasury Regulation 1.6031(a)-1(b) for further information.

  2. Foreign Partnership applicants are not required to file Form 1065.

  3. Foreign Partnerships that have U.S. partners/members are entitled to U.S. Residency certification, provided the partnership meets all of the U.S. Residency certification requirements for such applicant.

  4. Foreign Partnerships must provide:

    1. Under penalties of perjury, a list identifying the name, TIN and type of form filed of any partner for whom U.S. Residency certification is requested

    2. Form 8821 or like statements from all partners authorizing the requestor to receive their individual tax information

    3. Tax disclosure authorization from the partnership when the requestor is not a partner of the partnership during the tax year for which certification is requested

    4. If current year, current year POP from all current partners and a current year POP from a general partner that the foreign partnership is not required to file a Form 1065 and the entity classification has not changed since the filing of the partners’ returns.

  5. When a Partnership or pass-through entity is listed as a partner within the partnership listing, you must also secure:

    1. A list of those partners, shareholders, participants, etc.

    2. Written authorization from the individuals listed within the Tier 2 partnership, Tier 3, etc.

  6. When second or third tier entities do not provide the required list or authorizations, the entity (second or third tier) must not be listed as a partner on the certification.

  7. Foreign Partnerships, in addition to meeting the requirements in this section, must meet all the requirements of a partnership applicant.

    Exception:

    Foreign partnerships that do not have to file Form 1065.

  8. When all requirements for foreign partnerships have been met, issue certification using one of the interim paragraphs in the PTR.FGNPTR. series.

Trust Applicants
  1. A Trust is an arrangement created either by a will or by an inter vivos declaration by which trustees take title to property for the purpose of protecting or conserving it for the beneficiaries. The beneficiary is:

    1. An heir

    2. A legatee

    3. A devisee

  2. A trust is a legal entity created under state law and taxed under federal law. There are two different types of trusts that can be certified:

    • Domestic Trust

      Note:

      Trusts that are foreign, but have U.S. owners or U.S. beneficiaries, are treated as domestic for U.S. residency purposes.

    • Non Exempt Charitable Trust

  3. A trust is a domestic trust if a court within the U.S. is able to exercise primary supervision over the administration of the trust, and one or more U.S. persons have authority to control all substantial decisions of the trust.

Definitions
  1. The following are some definitions that are helpful in understanding trust entities:

    • Fiduciary - a trustee of a trust or executor, executrix, administrator, administratrix, personal representative, or person in possession of property of a decedent's estate.

    • Beneficiary- a person designated as the recipient of funds or other property under a trust or an estate.

    • Corpus - The principal sum or capital of a trust or an estate, as distinguished from interest or income.

    • Maker, Grantor, etc. - The person/organization that originated the trust or which has control over the trust.

Types of Trusts
  1. The following is a list of basic types of Trusts:

    • Inter vivos Trust--Established by a grantor during his lifetime.

    • Testamentary Trust--Set forth or contained in a will or a formal declaration of a person's wishes as to the disposition of his property after his death. A paper, instrument, document, gift, appointment, etc., is said to be "testamentary" when it is written or made so as not to take effect until after the death of the person making it, and to be revocable and retain the property under his control during his life, although he may have believed that it would operate as an instrument of a different character. A "trust under the will" is the same as a testamentary trust.

    • Revocable Trust--The grantor has control of the trust (power to repeal, annul) and will pay the taxes of the trust on his or her Form 1040 return. The grantor will file the Form 1041 return for "Information Only" purposes.

    • Irrevocable Trust-- The trust cannot be repealed or annulled. The grantor may have certain powers over the trust and be taxable on the Trust income.

    • Pooled Income Trust--A split interest trust with a remainder interest for a public charity and a life income interest retained by a donor or for another person.

Domestic Complex Trusts
  1. A Domestic Complex Trust is any domestic trust that does not qualify as a simple trust. See IRM 21.8.4.7.12.8.8, Simple Trust, for additional information. A complex trust is allowed to take a distribution deduction if it distributes income currently; however, we do not treat the entity as a pass-through entity with respect to the distributed income. Certify the trust at the trust level.

  2. A non-grantor trust is any trust to the extent that the assets of the trust are not treated as owned by a person other than the trust.

    1. Certify non-grantor trust applicants at the trust level, provided they are eligible for U.S. residency certification.

    2. Non-grantor Trust Applicants - as a general rule, only domestic non-grantor trusts that file Form 1041 are granted U.S. Residency Certification.

  3. If the trust is not required to file Form 1041, it must:

    • Check the Non-filing Entity box

    • Provide an explanation with the application

      Note:

      Explanations provided separate from the application must be submitted under penalties of perjury.

Group Trusts — Revenue Ruling 81–100
  1. Group Trust arrangements, described in Revenue Ruling 81-100, that have received a determination letter must attach a copy of the determination letter to their application.

  2. Group Trust arrangements, described in Revenue Ruling 81-100, certification applications submitted for Switzerland, with respect to dividend paid by a Swiss Corporation, must also include:

    • A list of participants

    • A statement that each participant listed is a trust forming part of a plan described in IRC § 401(a), IRC § 403(b), or IRC § 457(b)

Current Year Applications
  1. Common Trust Fund, Simple Trust and Grantor Trust for Current Year Applicants, in addition to the requirements listed above, must include:

    1. A penalties of perjury statement (POP) from the trustee indicating that the trust is a U.S. trust and will continue to be throughout the current tax year, and

    2. A penalties of perjury statement from every participant/owner/beneficiary or authorized representative (POA) requesting certification, that they are a resident of the United States of America for purposes of U.S. taxation and will remain so throughout the current tax year.

      Note:

      When entering the participants/owner/beneficiary list, DO NOT check the POP indicator box UNTIL you have verified receipt of a POP statement.

Incomplete Trust Applications
  1. When the Form 8802, line 4c, isn’t checked on the application, process as a complex trust without contacting the applicant .

  2. When all required information has been verified, the Form 6166 can be issued using one of the TRU.81-100 paragraphs.

  3. When the applicant doesn't provide the required information, request the information using the appropriate letter.

    1. If applicant responds with the required information, and all requirements have been met, issue certification Form 6166.

    2. If applicant fails to provide the required information within 30 days (60 days overseas), close the application as a No Reply.

  4. A Form 1041 must be filed by the fiduciary, trustee of the trust, or one of the joint fiduciaries for a domestic trust that is taxable under IRC § 641.

    Note:

    The fiduciary in this instance is a trustee of the trust.

  5. A Form 5227 must be filed for:

    • Charitable remainder trusts as described in IRC § 664

    • Pooled income funds as described in IRC § 642(c)(5)

    • Charitable lead trusts

  6. In addition to a Form 1041, Form 1065, Form 1120, or Form 5227 return having been filed or an extension, the authorized requestor of a trust must provide with the Form 8802, the following information:

    • Application Information (Trust Information):

    • Applicant's TIN

    • The Name and identification number as it should appear on the certification (when applicable)

    • Mailing Address (if other than applicant's address)

    • Permanent Residence Address (when applicable)

    • TIA (when applicable)

    • Entity Type and the type of Trust for which certification is requested

    • Tax Form filed

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax period

    • Certification Type

    • Country and number of certifications requested

    • The Applicant's parent organization information (when applicable)

    • Penalty of Perjury statements (when applicable)

    • Form 8802 must be signed by the trustee or the POA

  7. Trust Applicants must specify on the Form 8802 the type of trust for which certification is requested.

  8. When the required information has been provided and the appropriate return is filed, issue Form 6166 using one of the TRU.1041 paragraphs.

  9. If no return has been filed, you must verify the trust filing requirements:

    • 1041-1 (Form required)

    • 1041-0 (Form not required)

    • 5227-1 (Form required)

    • 5227-2 (Form required)

    • 5227-0 (Form not required)

  10. If a return is not required to be filed, issue Certification Form 6166 using one of the trust paragraphs:

    1. TRU.1041

    2. TRU.1041.SP

    3. TRU.1041.GR

    4. TRU.1041.RS

    5. etc.

  11. If a return is required, correspond via phone or using Letter 3444.

    1. When the response indicates that the trust is a newly established trust and the Trust Agreement is provided, issue Certification Form 6166.

    2. When the applicant fails to provide the required information within 30 days (60 days overseas), close the application as a no reply.

  12. Any trust applicant that has had its application declined, but believes it is entitled to U.S. Residency Certification, should submit a copy of its completed Form 8802, attach a detailed explanation, including documentary evidence, and/or regulation or Code section, as to why it believes it is entitled to certification.

    1. Place the case in status 702, and

    2. Forward all applications and attachments to HQ through Planning and Analysis.

Grantor Trust
  1. A grantor trust may be set up by a living person or by an organization or created by a will. All, or a portion of the income from the trust, is taxable income of the grantor. The Grantor's share of trust income, deductions, and credits are not reported on Form 1041 return, but are shown on a separate statement that is attached to Form 1040 return. The assets of the trust are treated as owned by the grantor.

  2. A grantor trust is a trust under applicable state law that is not recognized as a separate taxable entity for income tax purposes.

    Note:

    A living trust or grantor trust is not an official trust, unless the trust has an official EIN. Taxes on this type of trust are passed through to the grantor of the trust. Grantors of living trusts that do not secure an EIN for the trust must be certified as an individual, when the individual requirements are met.

  3. A grantor includes any person/organization:

    1. Who creates a trust, directly or indirectly by making a gratuitous transfer of cash or other property to a trust

    2. Treated as the owner of any part of a trust

  4. A grantor trust is identified on Line 4c of Form 8802.

  5. Grantor trusts must be certified at the owner's level. The trust itself files a Form 1041 (informational) but is ignored for tax purposes and all income, deductions, etc. are treated as belonging to the owner. Therefore, applicants must identify:

    • The name and TIN of the trust

    • The name and TIN of the owner/owners, and depending on whether the owner is an individual or other type entity, the relevant information necessary for certification of that type of person

    • Authorizations (Form 8821 or like form) from each beneficial owner for which certification is requested. The authorizations must authorize the 3rd party requestor to receive their tax information, and

    • Authorization from the trustee, when the requestor is other than a trustee in the trust

  6. When one or more of the trust grantors are verified as U.S. Residents and the Form 1041 was filed for the trust when required, issue the certification with a list identifying the grantors that are U.S. residents using one of the TRU.GT paragraphs.

  7. Grantor trusts that are foreign can be certified as a U.S. resident, provided the owner of the trust is a U.S. resident and filed a Form 3520-A, Annual Return of Foreign Trust With a U.S. Owner, and have met all of the other trust certification requirements in (5) above, when applicable. Issue certification using one of the interim TRU.3520A.FGNGT paragraphs.

  8. Grantor trust applicants that are foreign trusts that have not filed Form 3520-A, Annual Return of Foreign Trust With a U.S. Owner , identifying the U.S. owner (Form 3520-A Page 3) cannot be certified. Foreign grantor trusts cannot be certified unless the trust owner is identified and the owner is a U.S. resident. Verification includes submission of:

    1. The signed Form 3520-A

    2. A copy of the trust agreement

  9. Use the chart below to work status codes 650, 520, and 522/322 for grantor trust Applicants.

    If Then
    Status Code 650 Check for input errors. Use Form 8802 to verify the type of certification application.
    The application is for VAT, not Income Tax, and required return has been filed Check the VAT indicator and issue VAT certification using TRU.GT.VAT.
    No input errors Follow procedures for securing owners list.
    Status Code 520 Check for input errors. Verify owners' Names and TINs using owners list, correct accordingly.
    No input errors or corrections made and the required return has been filed, but one or more owners failed to file their return Issue certification with list of owners that filed their required returns using TRU.GT.
    No input errors or corrections made, return filed if required and one or more of the owners are still invalid Issue certification with list of owners that filed their required returns using TRU.GT.
    Status Code 522/322 Check for input errors. Verify owners' names and TIN(s) using owners list, correct accordingly.
    No input errors and one or more of the owners filed a Form 1040NR Issue certification, with list of owners that filed as U.S. residents. If none filed as residents, issue letter 3425.
  10. Certification of a grantor trust, in addition to meeting all of the general trust certification requirements, must meet the requirements of a pass-through entity.

    1. The trust must file a return when required.

    2. At least one owner must be a resident of the U.S. for tax purposes.

  11. When none of the owners filed their required tax return, extension, or have a determination letter, reject the grantor trust application.

  12. Do not list owners in the grantor trust that failed to file, failed to provide authorization, filed as a non-resident, or filed a tax return claiming a foreign tax home (Form 2555 filed, see exception), on the Grantor trust certification.

    Exception:

    If the country for which the treaty benefit is claimed was Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine and the country on the Form 2555 is not the same country for which certification is requested, Form 2555 was not filed by the requestor (it belongs to the spouse), the Form 2555 was for a partial year, or the requestor filed a dual status return.

Simple Trust
  1. A simple trust is:

    1. An instrument that requires all income be distributed currently

    2. An instrument that does not provide that any amounts be paid, permanently set aside, or used for charitable purposes; and

    3. An instrument that does not distribute amounts allocated to the corpus of the trust

  2. The trust is a simple trust only for a year in which it distributes income and makes no other distributions to beneficiaries. For a year when the trust does not meet these requirements, it is a "complex trust."

  3. A simple trust applicant:

    • Is identified on Line 4c of Form 8802

    • Must file a Form 1041

    • Distributes its income to the beneficiaries

  4. A simple trust must be certified at the beneficiary level. A beneficiary includes any person that could possibly benefit (directly or indirectly) from the trust whether or not the person:

    1. Is named in the trust as a beneficiary, or

    2. Can receive a distribution from the trust in the current year

  5. As a simple trust itself is ignored for tax purposes and all income, deductions, etc. are treated as belonging to the beneficiary/beneficiaries, these trust applicants must provide:

    • The name and TIN of the trust

    • The name and TIN of the beneficiary/beneficiaries, and, depending on the whether the beneficiary is an individual or entity, the relevant information necessary for certification of that type of person

    • Authorizations (Form 8821 or like form) from each beneficiary for which certification is requested. The authorizations must authorize the 3rd party requestor to receive their tax information, and

    • Authorization from the Trustee, when the requestor is other than a trustee in the trust

  6. Certification of a simple trust, in addition to meeting all of the general trust certification requirements, must meet the requirements of a pass-through entity.

    1. The trust must file its required Form 1041 return.

    2. At least one of the beneficiaries must be a resident of the U.S. for tax purposes.

  7. When none of the beneficiaries filed their required tax return, extension, or have a determination letter, reject the Simple Trust application.

  8. Do not list beneficiaries in the trust that failed to file, failed to provide tax disclosure authorization, filed as a non-resident, or filed a tax return claiming a foreign tax home (Form 2555 filed, see exception), with the list of participants/owners that are certified as U.S. residents on the U.S. Residency certification.

    Exception:

    If the country, for which the treaty benefit is claimed, was Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine and the country on the Form 2555 is not the same country for which certification is requested, Form 2555 was not filed by the requestor (it belongs to the spouse), the Form 2555 was for a partial year, or the requestor filed a dual status return.

  9. If the simple trust meets all of the certification requirements, issue Form 6166 certification.

  10. When one or more of the beneficiaries are verified as a U.S. Resident and the Form 1041 was filed for the trust, issue the certification with a list identifying the beneficiaries that are U.S. residents using one of the TRU.1041.ST paragraphs.

Common Trust Funds
  1. Common trust funds, as defined in IRC § 584 , should not file Form 1041 and must be certified at the participants level; therefore, they must identify on Form 8802 the participants in the trust as well as the number for which certification is requested.

  2. Common trust funds (CTF), as defined in Code § 584, are required to file a U.S. Income Tax Return, generally Form 1065.

  3. Certification of a common trust fund, as defined in Code § 584, requires:

    • The name and TIN of the CTF

    • The name and TIN of each participant, and, depending on whether the participant is a tax exempt or other type of person, the relevant information necessary for certification of that type of person

      Caution:

      When a flow-through entity is listed as a participant within the participants list, secure a listing of the persons within that flow-through entity that the applicant is requesting certification and verify their filing requirement.

    • Authorizations (Form 8821 or like form) from each participant for which certification is requested. The authorizations must authorize the 3rd party requestor to receive their tax information.

    • An authorization from the trust, when the requestor is other than a trustee in the trust

    • The filing of the CTF's required return

    • The filing of the required tax return of each CTF participant for which certification is requested

    • A determination letter or proof that the participant is not required to file, when applicable

    • An IRS Determination Letter or Revenue Ruling letter used as proof of exemption from taxation and filing, and a penalties of perjury statement, specifically stating that the organization was organized in the U.S. and carries out its exempt function primarily in the U.S.

  4. Common trust funds, as defined in IRC § 584, that apply for certifications for Switzerland with respect to dividends paid by a Swiss Corporation must also have the following attached to their Form 8802:

    • A list of each participant that is a trust forming part of a plan described in IRC § 401(a). IRC § 403(b), or IRC § 457(b) or is a trust that is described in IRC §401(a), IRC § 403(b), or IRC § 457(b) within a group trust arrangement described in Rev. Rul. 81-100 for which certification is requested

    • A statement that each participant listed on the attached list is a trust forming part of a plan that is described in IRC § 401(a), IRC § 403(b), or IRC § 457(b), or is a trust forming part of a plan described in IRC § 401(a), IRC § 403(b), or IRC § 457(b) that is within a group trust arrangement described in Rev. Rul. 81-100

  5. When none of the participants filed their required tax return, extension, or have a determination letter, reject the CTF application.

  6. If any of the participants in the CTF failed to file, failed to provide authorization, filed as a non-resident, or filed a tax return claiming a foreign tax home (Form 2555 filed, see exception), issue the certification with a list of the participants/owners that are considered U.S. residents.

    Exception:

    If the country for which the treaty benefit is claimed was Bangladesh, Bulgaria, Cyprus, Hungary, Iceland, India, Kazakhstan, Malta, New Zealand, Russia, South Africa, Sri Lanka, or Ukraine and the country on the Form 2555 is not the same country, Form 2555 was not filed by the requestor (it belongs to the spouse), the Form 2555 was for a partial year, or the requestor filed a dual status return.

  7. Common trust funds are issued certification using one of the TRU.1041.CTF paragraphs and a list of their participants that filed as U.S. residents.

  8. Use the chart below to work status codes 650, 520, and 522/322 for common trust funds as defined in IRC § 584:

    If Then
    Status Code 650 Check for input errors. Use Form 8802 to verify the type of certification application.
    Application is for VAT, not Income Tax, and return was filed (when required) Check the VAT indicator and issue VAT certification.
    No input errors Follow procedures for securing participants list.
    Status Code 520 Check for input errors. Verify owner's Name and TIN using participants list, correct accordingly.
    If no input errors or corrections made, the return was filed (when required), but one or more participants failed to file their return Issue certification with list of participants that filed their required returns.
    If no input errors or corrections made, the return was filed (if required), but one or more of the participants are still invalid Issue certification with list of participants that filed their required returns.
    Status Code 522/322 Check for input errors. Verify participants’ names and TINs using participants list, correct accordingly.
    No input errors, the return was filed (if required), and one or more of the participants filed a Form 1040NR Issue certification, with list of participants that filed as U.S. residents.
Foreign Assets Securitization Investment Trusts (FASITs/IRC § 860H)
  1. IRC § 860H - A FASIT, is a financial asset securitization investment trust, a qualified arrangement that meets the requirements of § 860L(a)(1) .

    Note:

    Effective January 1, 2005, the special rules for FASITs were repealed. However, the special rules still apply to any FASIT in existence on October 22, 2004, to the extent that regular interests issued by the FASIT before that date continue to remain outstanding in accordance with the original issuance.

    1. FASITs are used to securitize debt obligations such as credit card receivables, home equity loans, and auto loans.

  2. A qualified arrangement becomes a FASIT when an eligible corporation, as defined in IRC § 860L(a)(2), submits a timely filed election as required under IRC § 860L(a)(1)(A).

  3. A timely filed FASIT election is a statement submitted with a timely filed original federal income tax return (including extension) for an eligible C corporation. The statement must be filed in the taxable year in which the FASIT's startup day occurs.

    Note:

    Elections cannot be made on an amended return.

  4. FASIT elections must contain:

    1. The name, address, and the applicant's tax identification number (if issued prior to making an election) of the arrangement

    2. The startup day of the FASIT

    3. The name and title of all persons signing the election statement

  5. A FASIT is a pass-through entity. When the corporate owner makes an election to have the qualified arrangement treated as a FASIT, the corporation becomes liable for reporting all of the FASIT's income, gain, deductions, losses, and credits on its Form 1120, U.S. Corporate Income Tax Return.

  6. A Form 8802 submitted on behalf of a FASIT requires:

    • The requirements of a corporation

    • A copy of the FASIT election

    • A statement from the Corporate owner. See paragraph (7) below.

  7. The statement that must be submitted on behalf of a FASIT applicant must contain the following information:

    " XXX Corporation, EIN is the corporate owner of (FASIT name, TIN), which is treated as a FASIT under IRC § 860H; as such, the (corporation name) reports all of (FASIT name's) income, gains, deductions, losses and credits on our Form 1120, U.S. Corporate Income Tax Return."

    Reminder:

    This statement must be submitted under penalties of perjury, if not submitted with the application.

  8. When the FASIT application is complete and includes the required Corporate owner statement:

    1. Enter the Parent Corporation's TIN in the primary TIN field.

    2. Enter the FASIT's TIN in the Secondary TIN field.

    3. Enter the FASIT's entity information in the Applicant Information field.

    4. Enter the FASIT's parent's name control in the Name Control field.

    5. Enter all other required information.

      Reminder:

      Be sure to check the FASIT verified box if you have the Corporate owner's statement.

  9. Issuance of a U.S. Residency Certification to a FASIT requires that:

    1. The corporate owner meet all of the certification requirements of a corporation

    2. A copy of the corporate owner's FASIT election be provided

    3. A declaration statement made under Penalties of Perjury be provided with the required U.S. Residency certification application

  10. When the corporate owner of the FASIT has been verified as a U.S. corporation, issue certification using one of the TRU.1120.FASIT paragraphs.

Individual Retirement Account (IRA)
  1. A Individual Retirement Arrangement within the meaning of IRC § 408(a) and Roth IRAs within the meaning of IRC § 408A (collectively referred to as IRAs) may be certified as residents (without regard to the residence of the IRA holder).

    Note:

    Either an IRA holder or the trustee of the IRA may apply for certification on behalf of the IRA.

  2. Form 8802, on behalf of an IRA that is a recipient of income, must include:

    • Application Information (Name/Number of the IRA being certified)

    • IRA holder's TIN, the SSN/Account Number used to report the income

    • Permanent Residence Address (when applicable)

    • Mailing Address (if other than applicant's address)

    • TIA (when applicable)

    • Entity Type is a Trust-IRA

    • Line 5, Tax Form filed

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax period

    • Certification Type

    • Country and number of certifications requested

    • Penalty of Perjury statements (when applicable)

    • Form 8802 must contain a signature and date,

    • A copy of Form 8606, Nondeductible IRAs, or Form 5498, IRA Contribution Information

  3. A bank or financial institution acting as the trustee for IRA(s) may apply for certification for multiple IRA(s) grouped by year and by country for which certification is requested. The bank or financial institution must include the following with the Form 8802 they must prepare:

    • A list of IRA account names (i.e., the IRA holder’s name) and numbers for which certification is requested

    • A statement that each IRA account name and number listed is an IRA within the meaning of IRC § 408(a) or IRC § 408A

    • A statement that the bank or financial institution is a trustee of the IRA

  4. Certification of an IRA requires that you verify that an IRA is established within the U.S.

  5. Verification that an IRA exists requires that the IRA owner or Trustee provide a copy of Form 5498, IRA Contribution Information, or a signed copy of Form 8606, Nondeductible IRAs, when Form 5498 is not available.

  6. Issue certification after you have verified that the IRA exists within the meaning of IRC § 408(a) or IRC § 408A.

  7. Issue certification using one of the interim TRU.1040.IRA paragraphs.

  8. The Certification should state: "I certify to the best of our knowledge, that the above-named Individual Retirement Plan is a resident of the United States of America for purposes of U.S. taxation."

Estate Applicants
  1. An estate is a legal entity that is created as the result of a person's death or bankruptcy. The estate consists of the real and/or personal property of the deceased person. The estate pays any debts owed by the decedent and then distributes the balance of the estate's assets to the beneficiaries of the estate.

  2. The following is a list of definitions for different types of estates:

    • Ancillary and Domiciliary Estate - an ancillary estate (real and/or personal property of the deceased person) is an estate which exists in a "foreign" state because the applicant was domiciled (resided) in another state at the time of death.

    • Probate Estate - is the same as an estate entity. Probating an estate in court is done to establish that the will is authentic or valid.

    • Bankruptcy Estate - a bankruptcy estate is a separate and distinct taxable entity from the individual debtor, when an individual debtor files for bankruptcy under Chapter 7 or 11. When a case is created under any chapter of the bankruptcy code, a separate estate is created consisting of property held by the debtor as of the commencement of the case and under certain circumstances, property acquired by the debtor and the estate after commencement of the case.

    • Decedent Estate - estate of a deceased person that is a taxable entity separate from the decedent. It exists until the final distribution of the assets is made to the heirs and other beneficiaries.

  3. The type of estates that most often request U.S. Residency certifications is decedent estates.

  4. A decedent estate figures its gross income much like an individual:

    • Deductions and credits allowed for an individual are allowed to the estate.

    • The major difference between how an individual figures income and how an estate does, is that an estate is allowed an income distribution deduction for distributions to its beneficiaries.

  5. Income distributions to beneficiaries are taxable to the beneficiary; however, estates are treated as residents and U.S. residency certifications are issued at the estate level, regardless of whether or not it distributes its income.

  6. Certification of an estate applicant requires that the applicant complete all of the Form 8802 required fields, that a Penalties of Perjury statement be provided when necessary, e.g., the request is for the current year and the estate has not filed its required Form 1041.

  7. When an estate has met all certification requirements, issue certification using one of the EST.1041 paragraphs.

Limited Liability Company Applicants
  1. A Limited Liability Company (LLC) is an entity formed under state law by filing articles of organization as an LLC.

  2. A Limited Liability Company may elect to be classified for federal tax purposes either as:

    • A partnership (more than one owner)

    • An association taxable as a corporation, or

    • A disregarded entity, separate from its owner (single owner)

  3. Pursuant to Treasury Regulation 301.7701-3(a), a single-member LLC can only elect to be classified for federal income tax purposes as:

    • An association taxable as a corporation

    • A single-member LLC that fails to make an election is automatically disregarded as an entity separate from its owner

    Note:

    A single-member LLC cannot elect to be classified as a partnership.

  4. A limited liability company uses Form 8832, Entity Classification Election, to elect their entity classification.

  5. When the Form 8832 election is processed, transaction code 076 appears in the entity module if the election was accepted. Transaction code 078 appears if the election was rejected.

  6. A LLC that fails to file Form 8832 electing its classification will DEFAULT:

    • A LLC with at least two members, that does not file a Form 8832 to classify itself as a corporation, is classified by default as a partnership for federal tax purposes.

    • A single-member LLC that fails to make an election is disregarded as an entity separate from its owner.

  7. In the year 2001 and prior, a LLC electing to be classified for federal income tax purposes as disregarded as an entity separate from its owner filed Form 966, Corporate Dissolution or Liquidation.

  8. When an applicant submits a Form 966 (filed in 2001 or prior) and claims that the LLC is classified for federal income tax purposes as a disregarded entity (DRE), but a TC 076 cannot be located, you must:

    1. Process the applicant as a LLC-DRE using the procedures below, provided the required POP was submitted.

    2. Forward a copy of the Form 966 with the POP to Entity requesting input of TC 076, using Form 4442.

  9. When certifying a LLC that is classified as a partnership entity for federal tax purposes, click the LLC box. See IRM 21.8.4.7.12.7, Partnership Applicants, for procedures.

  10. When certifying a LLC that has elected to be classified as a corporate entity for federal tax purposes, see IRM 21.8.4.7.12.3, Corporate Applicants, for procedures.

  11. Form 8802 of a single-member LLC requires:

    • Applicant's Information (the name of single-member LLC)

    • Applicant's TIN, EIN of the single-member LLC

    • Permanent Residence Address (when applicable)

    • Mailing Address (if other than applicant's address)

    • TIA (when applicable)

    • Entity information single-member LLC owner (must be entered in applicant Entity field)

    • Primary TIN field (a single-member LLC applicant's owner's EIN must be entered in this field )

    • Entity

    • Tax Form filed

    • Requested certification year (the year the applicant wants printed on the Form 6166)

    • Tax Period

    • Certification Type

    • Country and number of certifications requested

    • Penalty of Perjury statements (when certification is for a disregarded single-member LLC that is newly formed or certification is for the current year)

    • A signature and date

    • Any other information required by the procedures for the certification for the single member LLC owner's type entity

  12. Single-member owners will be one of the following type entities:

    • Individual (1040 LLC) - in addition to the requirements above, see IRM 21.8.4.7.12.2, Individual Applicants, for additional information.

    • Corporation (1120 LLC) - in addition to the requirements above, see IRM 21.8.4.7.12.3, Corporate Applicants, for additional information.

    • S Corporation (1120S LLC) - in addition to the requirements above, see IRM 21.8.4.7.12.5, Subchapter S Corporation Applicants, for additional information.

    • Partnership (1065 LLC) - in addition to the requirements above, see IRM 21.8.4.7.12.7, Partnership Applicants, for additional information.

    • Trust (1041 LLC-T ) - in addition to the requirements above, see IRM 21.8.4.7.12.8, Trust Applicants, for additional information.

    • Estate (1041 LLC-E ) - in addition to the requirements above, see IRM 21.8.4.7.12.9, Estate Applicants, for additional information.

  13. When required, the Single-Member LLC Penalties of Perjury Statement paragraph must state:

    "This certifies that (i)(corporation / partnership / individual), TIN: 78-XXXXXXX trading as (XXXX LLC), is a single-owner Limited Liability Company that is treated as a disregarded entity for United States income tax purposes, (ii) that (corporation/partnership/individual) is the single owner of the (LLC) and, (iii) as such, (corporation/partnership/individual) is required to take into account all of the income, gain, loss, deductions and credits against tax of the ( LLC) on (its/his/her) U.S. federal income tax or information return. This certification is given under penalties of perjury and to the best of my knowledge and belief; the statements herein made are true, correct and complete."

  14. A Single Member LLC classified as a disregarded entity of a foreign person is not eligible for U.S. Residency Certification.

  15. A single member LLC organized outside of the U.S., but the owner is a U.S. Corporation and the corporation has identified the LLC in the Schedule N attached to its Form 1120, can be issued certification for tax years ending prior to January 1, 2004.

  16. For tax years beginning on or after January 1, 2004, an applicant that is a disregarded entity organized outside of the United States whose owner is a U.S. person or entity, must attach a copy of the Form 8858 , Information Return of U.S. Person With Respect to Foreign Disregarded Entities, filed with the owner's return.

    1. Applicants whose owners fail to identify the foreign disregarded entity on a Form 8858 must not be certified.

    2. If the certification application is for a tax year prior to January 1, 2004, the applicant must provide proof, such as a Schedule N, that the foreign disregarded entity is owned by a U.S. resident.

  17. Applicants that were rejected but believe they are entitled to U.S. Residency Certification, should submit a copy of their completed Form 8802, and attach a detailed explanation or regulation or Code section, including documentary evidence, as to why they believe they are entitled to certification. Once you receive the application:

    1. Place the case in status 702.

    2. Note in the Remarks Section "forwarded to HQ via Planning and Analysis."

    3. Forward to HQ via Processing and Analysis.

  18. If you have all of the LLC applicant's required information, in addition to inputting the other required fields, you must:

    1. Enter the TIN of the LLC owner in the primary TIN field.

    2. Enter the TIN of the LLC in the secondary TIN field.

    3. Enter the form that the single member's owner files in the Form field.

    4. Enter the LLC owner's name in the applicant Entity field.

    5. Enter the LLC owner's Name Control in the Name Control field.

    6. Enter the LLC's name in the Certified Name Line field.

    7. Check the penalties of perjury box indicating you have verified receipt of the LLC Penalties of Perjury Statement (when applicable).

    IF THEN
    The LLC application generates a Status Code 103 Verify that the application information was entered according to (13) above.
    The LLC application information was incorrectly entered Correct accordingly and continue processing.
    The information was correctly entered Check CC INOLE and/or ENMOD for discrepancy, correct when able or contact taxpayer for additional information.
    All of the required information is received, entered and validated (status code 099) Issue certification.
    The LLC owner failed to file the required return Issue letter 3426 or letter 3444.
    The response to your correspondence indicates that the LLC is newly established, created using Form 966, or established by default Verify that the required POP statement has been submitted and a TC 076 is posted or Form 8832 was approved.
    The required POP statement has been submitted and a TC 076 is posted or the approved Form 8832 was submitted and all other LLC-DRE certification requirements have been met Issue certification. Check the “not required” file field, then check the U.S. DRE LLC box which will ensure the correct paragraph is used for a DRE LLC.
    The applicant fails to respond to Letter 3426 or 3444 with the required information within 30 days (60 days overseas) Close the application as a No Reply, using status code 199.
  19. Any single member LLC applicant that has had its application declined, but believes it is entitled to U.S. Residency Certification, should submit a copy of its completed Form 8802, and attach a detailed explanation, regulation or Code section, including documentary evidence, as to why it believes it is entitled to certification. Once the application is received:

    1. Place the case in status 702.

    2. Notate in the Remarks section "forwarding the application to HQ via Planning and Analysis."

    3. Forward the application to HQ via Planning and Analysis.

Partnerships with a Single Owner
  1. The following instructions apply when an organized under state law partnership (including a general partnership, limited partnership, limited liability partnership, or limited liability limited partnership) becomes a single-owner entity for federal tax purposes and requests a U.S. residency certification.

  2. Treasury Regulation 301.7701-3(f)(2) provides that an entity classified as a partnership becomes disregarded as an entity separate from its owner when the entity's membership is reduced to one member. No election is required to be filed.

  3. The partnership files a final partnership return, which serves as the notice of the termination of the partnership.

  4. The owner reports all items of income, gain, loss, deductions, and credits from the disregarded entity in its required tax return. However, there are no specific lines on any of the required forms in which to report items from the disregarded entity.

  5. Single-member owners that may receive a U.S. residency certification will be one of the following:

    • Individual (1040) - in addition to the requirements above, see IRM 21.8.4.7.12.2, Individual Applicants, for additional procedures.

    • Corporation (1120) - in addition to the requirements above, see IRM 21.8.4.7.12.3, Corporate Applicants, for additional procedures.

    • S Corporation (1120S) - in addition to the requirements above, see IRM 21.8.4.7.12.5, Subchapter S Corporation Applicants, for additional procedures.

    • Partnership (1065) - in addition to the requirements above, see IRM 21.8.4.7.12.7, Partnership Applicants, for additional procedures.

    • Trust (1041) - in addition to the requirements above, see IRM 21.8.4.7.12.8, Trust Applicants, for additional procedures.

    • Estate (1041) - in addition to the requirements above, see IRM 21.8.4.7.12.9, Estate Applicants, for additional procedures.

  6. If a partnership with two partners, one of which is wholly owned by the other partner and is disregarded for federal tax purposes, requests a U.S. residency certification, it must provide:

    1. Organizational documents (Partnership Agreement, Trust Agreement, etc.) to verify that the entity was formed as a partnership under state law, not as an LLC, and

    2. A Penalties of Perjury statement from its owner attesting to the reporting of all income, gain, loss, deductions, and credits of the entity on its tax return.

      Example:

      "This certifies that (i) (partnership), TIN XX-XXXXXXX, is a state law (general partnership / limited partnership / limited liability partnership / limited liability limited partnership) that is treated as a disregarded entity for United States federal tax purposes, (ii) that (owner) is treated as the single owner of the (general partnership / limited partnership / limited liability partnership / limited liability limited partnership) for United States tax purposes and, (iii) as such, (owner) is required to take into account all of the income, gain, loss, deductions, and credits against tax of the (general partnership / limited partnership / limited liability partnership / limited liability limited partnership) on its federal income tax return. This certification is given under penalties of perjury and to the best of my knowledge and belief, the statements are true correct and complete."

  7. When documentary evidence proves that the entity has met all of its application requirements, complete the following:

    1. Enter the TIN of the LLP's owner in the primary TIN field.

    2. Enter the TIN of the LLP in the secondary TIN field.

    3. Enter Form 1120 in the Form field.

    4. Enter the LLP owner's name in the applicant Entity field.

    5. Enter the LLP owner's Name Control in the Name Control field.

    6. Enter the LLP's name in the Certified Name Line field.

    7. Check off the penalties of perjury box when you have verified receipt of the LLP Penalties of Perjury Statement.

  8. When the owner has filed its required return as a U.S. resident, issue certification.

Exempt Organization Applicants
  1. An Exempt Organization (EO) is an organization exempt from federal income tax under IRC § 501(a). Generally, these organizations must apply for a ruling or determination letter to have their exempt status recognized. When an organization is granted an exemption, the exemption data are added to master file via the Exempt Plan — Exempt Organization Application Control System (EACS) system. For Additional information on exempt organizations, see IRM 21.3.8.12, Exempt Organizations (EO).

  2. An Exempt Organization applicant should include a copy of the organization's determination letter, private letter ruling, revenue ruling, etc., when applicable and the Form 8802 requires completion of:

    • Applicant's Information

    • Applicant's TIN

    • Permanent Residence Address (when applicable)

    • Mailing Address (if other than applicant's address)

    • Entity Type

    • TIA (when applicable)

    • Tax Form filed

    • Requested certification year (the year the organization wants printed on the Form 6166)

    • Tax period

    • Certification Type and specify whether or not organized in the U.S.

    • Country and number of certifications requested

    • Penalty of Perjury statements (when applicable)

    • Form 8802 signed by a corporate officer or the corporation's POA and date.

  3. Exempt organizations described in IRC 501(c)(1) are corporations organized under an Act of Congress that are:

    • Instrumentalities of the United States, and

    • Exempt from federal income tax

  4. Colleges and universities of states and other governmental units as well as subsidiary corporations wholly owned by such colleges and universities are required to file a Form 990–T, unless it is a corporation that falls under IRC § 501(c)(3).

  5. Exempt organizations described in IRC § 501(c)(3) include any community chest, fund, or foundation, organized and operated exclusively for:

    • Religion

    • Charity

    • Science

    • Testing for public safety

    • Literary purposes

    • Educational purposes

    • Fostering national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment)

      Note:

      IRC section 501(j)modified IRC 501(c)(3) to provide that a qualified amateur sports organization may provide athletic facilities and equipment and its membership may be local or regional in nature

    • Prevention of cruelty to children or animals

    Note:

    IRC § 501(c)(3)organizations are exempt from filing a corporate income tax return.

  6. In addition, no part of the Exempt Organization's net earnings can inure to the benefit of any private shareholder or individual, no substantial part of the activities of which is carrying on propaganda, or otherwise attempting to influence legislation (except as otherwise provided in subsection (h)), and which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.

  7. Exempt organizations that were NOT organized in the United States generally will not be issued a U.S. residency certification. However, those organizations that can prove entitlement to U.S. treaty benefits should complete Form 8802, submit it and all documentary proof of entitlement to treaty benefits.

    1. Proof of entitlement to a treaty benefit consists of a treaty article, private letter ruling, a regulation or Code Section, etc.

    2. Once received, the Certification Unit will place the application in 702 status and forward the entire case to HQ through the Planning and Analysis Analyst.

  8. An important factor in determining certification eligibility for an exempt organization that has not applied for determination letter or revenue ruling letter is verification of the organization's filing requirement.

  9. The following exempt organizations are not required to file:

    • Church, an interchurch organization of local units of a church, a convention or association of churches, integrated auxiliary of a church (men's/women's group, religious school, mission society, or youth group,) etc.- See Form 990 instructions

    • A school below college level affiliated with a church or operated by a religious order

    • A mission society sponsored by, or affiliated with one or more churches or church denominations, if more than half of the society's activities are conducted in, or directed at persons in, foreign countries

    • An exclusive religious activity of any religious order

    • A state institution whose income is excluded under IRC § 115

    • An organization described in IRC § 501(c)(1)

    • An exempt organization whose annual gross receipts are normally $50,000 or less.

    Note:

    Although the Form 990 series of forms may not be required, most organizations are required to submit the Form 990-N known as the e-postcard. This is not a return, but it results in a transaction code 150 on MFT 67. Failure to submit either one of the Form 990 series of forms or the Form 990-N for three consecutive years will result in revocation of the tax exempt status. See IRM 21.3.8.12.24, Annual Electronic Notice Filing Requirement, Form 990-N .

  10. Exempt organizations that claim they are not required to file and have not secured a determination letter from the IRS, generally will not be issued a U.S. Residency Certification unless we can verify their exempt status and their filing requirement. However, those organizations that have other means of proving entitlement to U.S. treaty benefits must complete Form 8802, submit it and all documentary proof of entitlement to treaty benefits. Forward these types of applications to HQ via the Planning and Analysis Analyst.

  11. An organization exempt from taxation may or may not be liable for filing a return.

    1. Organizations that are not liable for filing a return will have a Filing Requirement Code (FRC) 0.

    2. Organizations that are liable for filing a return will have a Filing Requirement Code (FRC) 1.

      Example:

      CC INOLE or ENMOD will indicate 990–01.

    3. Organizations with a FRC 1 must have filed the appropriate return or extension in addition to having a valid exemption status to be certified as a resident of the United States.

    4. Organizations that have a Filing Requirement Code (FRC) 8 are inactive and will need to contact the EO/EP Office at 1–877– 829–5500 to have the filing status updated.

  12. Use the following Employment Codes to determine if an applicant is a federal, state or local agency that is exempt under IRC § 501(c). Organizations with the following employment codes are considered government entities or are treated as such and may be certified as government organizations.

    • F- Federal Employer

    • G- State or Local Government Agency

    • I- Indian Tribal Governmental entity or one of its subdivisions, instrumentality, or a wholly owned subsidiary

    • T- State or local agency that has entered into a 218 agreement with SSA

    • W- Indian Tribal Governmental entity, or other organization, exempt under IRC § 501(c)3,IRC § 501(e), IRC § 501(f) , or IRC § 501(k)not subject to FUTA

  13. State or local government agencies requesting U.S. Residency certification that have an employment code G or T, or that have received a determination letter, private letter ruling, revenue ruling, etc. can be granted U.S. Residency Certification. Issue the Form 6166 with a paragraph containing the following language:

    I certify that the above-named entity is a State, or political subdivision of a State, or an agency, instrumentality, or public educational organization of a State or political subdivision, which is exempt from U.S. tax under the Internal Revenue Code, and is a resident of the United States of America.

  14. Federal, State or local government agencies requesting U.S. Residency certification that have not obtained a determination letter, private letter ruling, revenue ruling, etc. can submit in writing, on official government letterhead, a letter under penalties of perjury from a government official that the organization is a U.S. government agency. The signature of the government official generally will be that of the Director of Taxation, Director of Personnel or the like.

    1. This letter may be used as evidence of an organization's government status and entitlement to U.S. Residency certification.

    2. Once the letter and a completed Form 8802 are received, make every effort to process the Form 8802 and issue certification.

  15. The income of an approved Indian Tribal Governmental entity is not taxed, but it is not accurate to refer to them as tax exempt entities. When granting U.S. Residency Certification for an Indian Tribal Governmental entity with an Employment Code I, issue Form 6166 with a paragraph containing the following language:

    I certify that the above-named Indian tribe is treated as a State, a subdivision, or instrumentality, or a wholly owned subsidiary of a State, which is not taxed under the U.S. Internal Revenue Code, and is a resident of the United States of America.

  16. When granting U.S. Residency Certification for an Indian Tribal Governmental entity with an Employment Code W, issue Form 6166 with a paragraph containing the following language:

    I certify that, to the best of our knowledge, the above-named Indian tribe is treated as an exempt organization under section 501(c)(3) of the U.S. Internal Revenue Code, which is exempt from U.S. taxation under section 501(a), and is a resident of the United States of America for purposes of U.S. taxation.

  17. An exempt organization's entity must contain an acceptable exemption status code or employment code when the organization has not provided a determination letter, private letter ruling, revenue ruling, or a letter on official government letterhead validating that the organization is exempt from taxation and filing (See (12) and (13) above).

    1. Verify the organization's exempt status.

    2. See IRM 21.3.8.9.8, Tax Exempt/Government Entities (TE/GE) Customer Account Services (CAS) Telephone Operations, Status Codes — EO, for additional information on exemption status codes.

  18. When the exempt organization's entity has a missing or incorrect Employment Code, process as follows:

    1. Prepare a Form 4442. Include the name of the organization, EIN, and remarks indicating what is needed on the Form 4442 as well as IDRS screen prints.

    2. Fax the Form 4442 to the EO Clerical Unit using EEFax 855-214-7520.

  19. Use the following EO Entity Active Status Codes (STS-CD) in determining the type of exempt organization you are verifying and its filing requirements.

    • Status 01 or 02 - these indicate that an exemption has been granted to an organization. Check the subsection code to determine the type of exemption granted.

    • Status 06 - this is used for an account that is a state operated university or college filing Form 990–T. Certification would require the filing of Form 990–T.

    • Status 07 - this is used for an account that is a church filing a Form 990–T. Exempt as a church but required to file Form 990–T.

    • Status 11- this is used for a church-controlled school. Check the subsection code to determine if the church exemption was granted.

    • Status 12- this is a valid subsection provided there is a return filed under IRC § 4947(a) or IRC § 4947(a)(1) or Taxable Farmers' Cooperatives. Verify Code section using line 4h of Form 8802.

    • Status 30 - this is used for a Church voluntarily filing Form 990 though not required to file returns or apply for exemption (beginning January 1, 2001).

    • Status 31 - this is used for a small organization, other than churches and PFs with annual gross receipts less than $5,000 and which voluntarily file Form 990 though not required to file returns or apply for exemption (beginning January 1, 2001).

    • Status 34 - this is used for IRC § 527 Political Organizations.

      Note:

      In addition to having a Valid Entity Status Code, applicants that have a FRC 1 must have filed the appropriate return or extension.

  20. The following inactive status codes indicate the organization is not an active exempt organization.

    • Status 20 — indicates a voluntary termination

    • Status 22 — indicates a revocation

    • Status 26 — indicates a termination merger

    • Status 28 — indicates the organization is no longer a member of a group ruling

    • Status 29 — indicates the group ruling has been dissolved

    • Status 41 —indicates the organization failed to respond to Solicitation for Application after EO entity asks the organization for a copy of its determination letter and advises the organization that it must apply for formal recognition of its exemption if it does not already have a determination letter.

    • Status 70 — indicates the application was denied

    • Status 71 — indicates the exemption was not established

    • Status 97 — indicates the exemption was revoked because the organization did not file a required return for three consecutive years

    • Status 98 — indicates terrorist organizations.

  21. The Subsection Code (Subsec-CD) is a code designating the type of exemption granted an organization. Use the following EO Subsection Codes, along with the EO status codes, in determining the appropriate certification paragraphs to issue.

    • Subsec CD 01,02, 04-27 - IRC § 501(c)

    • Subsec CD 03 - IRC 501(c)(3)

      Note:

      Only organizations with this subsection can receive the § 501(c)(3) paragraph.

    • Subsec-CD 40 - IRC § 501(d) - Apostolic and religious organization

    • Subsec-CD 50 - IRC § 501(e) - Cooperative hospital service organization

    • Subsec-CD 60 - IRC § 501(f ) - Cooperative service organization of operating education organization

    • Subsec-CD 70 - IRC § 501(k) - Child Care Center

    • Subsec-CD 71 - IRC § 501(n) - Charitable Risk Pool

    • Subsec-CD 80 - IRC § 521 - Farmers' Cooperative

    • Subsec-CD 81 - IRC § 529 - Qualified state-sponsored tuition Program

    • Subsec-CD 90 - IRC § 4947(a)(2) - Split Interest Trust

    • Subsec-CD 91 - IRC § 4947(a)(1) - Public Charity

    • Subsec-CD 92 - IRC § 4947(a)(1) - Private Foundation

    • Subsec-CD 93 - IRC § 1381(a)(2)-Taxable Farmers' Cooperative

  22. Issue one of the 501(c) paragraphs, EOR.990.501C, to an organization with an EO Subsection Code 01,02, 04-27 - IRC § 501(c), along with a valid EO status code.

  23. Issue one of the 501(c)(3) paragraphs, EOR.990.501C3, to an organization with an EO Subsection Code 03 - IRC § 501(c)(3), and a valid EO status code.

  24. Issue the standard exempt organization paragraph, EOR.990.EXEMPT to an organization with an EO Subsection Code other than 01-27 - IRC 501(c), but with a valid EO status code, and to Federal Government entities with valid employment codes.

  25. Exempt organizations, including government entities that are not required to file a return, that do not have valid EO status codes or Employment Codes, and have not received a determination letter or private letter ruling from the IRS, generally will not be certified as an exempt organization. However, such an organization that has other ways of proving that it is a resident for tax purposes, may request that its application be forwarded to Headquarters via P&A.

    1. Proof of residency and entitlement to treaty benefits must include a copy of the organization's corporate charters, trust agreements, bylaws, etc.

    2. The applicant identified above must complete Form 8802 and attach or include a statement identifying the regulation or Code section that confirms it is not required to file.

  26. Issue a certification to exempt organizations, including government entities that are not required to file a return, do not have valid EO status codes and have not received a determination letter or private letter ruling, etc. from the IRS but have provided documentary evidence that they are U.S. residents and have had their applications approved by Headquarters. Use the following language:

    I certify that, to the best of our knowledge, the above-named applicant is a resident of the United States of America.

  27. When an organization exempt from taxation requests certification declaring that it is a church, but has not received a determination or ruling letter (generally in status code 01 with foundation code10), you must notify the applicant that it must contact the EO/EP office at 1–877–829–5500.

  28. When an organization exempt from taxation requests certification declaring that it is a church, exempt from taxation and reporting information or filing a return, the following is required:

    1. Verify (via IDRS, a letter ruling or a determination letter) that the organization is exempt from taxation.

    2. Verify (via IDRS, a letter ruling or a determination letter) that the organization is exempt from filing or reporting.

    3. If the information cannot be verified, issue letter 3430 .

      Note:

      A copy of the church directory alone is not proof of exemption from taxation or filing. It must be accompanied by a determination letter.

  29. The following chart should be helpful when manually verifying an Exempt Organization's exempt status and determining its eligibility for certification.

    If... Then...
    The applicant has an employment code F - indicating FEDERAL EMPLOYER Issue the 990 STATE OR 5500 paragraph - Applicant Not required to file.
    The applicant has an employment code G - indicating STATE GOVERNMENT Issue the 990 STATE OR 5500 paragraph — Not required to file.
    The applicant has an employment code I - indicating INDIAN TRIBE Issue the Indian Tribe paragraph or currently 990 STATE OR 5500 paragraph. Not required to file.
    The applicant has an employment code T- indicating STATE OR LOCAL GOVERNMENT Issue the 990 STATE OR 5500 paragraph. Not required to file.
    The applicant has an employment code W- indicating INDIAN TRIBE ONLY 501(c)(3) Issue the 501(c)(3) Indian Tribe paragraph or currently 501(c)(3) paragraph. Not required to file.
    The Applicant has a 990-06 filing requirement The applicant is Not Required to File. Issue 501(c)(3) paragraph.
    The Applicant has a 990T-2 filing requirement The applicant is a IRC § 401(a) Pension Trust - NOT REQUIRED TO FILE. Issue 5500 paragraph.
    The Applicant has a 990-13 filing requirement The applicant is NOT REQUIRED TO FILE— it's a RELIGIOUS ORG. Issue the 501(c)(3) paragraph.
    The Applicant has a 990-14 filing requirement The applicant is a STATE ORG NOT REQUIRED TO FILE. Issue 990 STATE.
    The following are valid status codes 1, 2, 6, 7, 11, 12, 30, 31, 34 WITH subsection codes 1, 2, 4-27 Check for the posting of a TC 150. When return posted, issue certification using the IRC § 501(c) paragraph, otherwise correspond using letter 3444 .
    Status codes 1, 2, 6, 7, 11, 12, 30, 31, 34 WITH subsection code 3 Check for the posting of a TC 150. When return posted, issue certification using the IRC § 501(c) paragraph, otherwise correspond using letter 3444 .
    Status codes 01 or 02 WITH subsection codes 50, 60, 70, 71, 80, 81, 90, 91, 92, 93 Check for the posting of a TC 150. When return posted, issue the GENERAL EXEMPT PARAGRAPH, otherwise correspond using letter 3444 .
    The applicant files a 990–PF The MFT is 44.
    The applicant files a 990 The MFT is 67.
    The applicant files a 990–T The MFT is 34.
  30. An organization whose entity does not contain one of the valid exemption status codes, but states that it is exempt under a Group Exemption Number (GEN), must be validated as an exempt organization. These organizations' entity must contain the same GEN as the parent organization and you must be able to validate that the parent is an exempt organization using the EO procedures identified above.

    1. When the parent organization has a valid group exemption status, has filed the appropriate return when required and both the parent and organization have the same GEN, you can issue certification to the organization.

    2. When the parent organization has a valid group exemption status, has filed the appropriate return when required, but the organization applying for certification does not have a GEN or it isn't the same as the validated parent, you must deny certification.

  31. Advise an organization claiming to be a subordinate of an exempt organization that does not have a GEN, that we cannot certify it unless the central organization has it added as a subordinate to its group exemption or can demonstrate it is a recognized subordinate of the central organization.

    Example:

    A subordinate church group can provide a determination letter of the central organization along with a copy of the page of the parent's official church directory identifying the subordinate group by circling its name.

  32. A central organization may add a subordinate to its group exemption at any time by sending the required information to the EO Entity in Ogden. Those wishing to add a subordinate to their group exemption may call 1-877-829-5500 for details of the process.

  33. An organization whose entity does not contain one of the valid exemption status codes, or is not confirmed as an exempt organization by a letter ruling, or a determination letter, is not considered an exempt organization according to IRS records and, therefore, cannot have its application certified as an exempt organization, even when there is a posted return.

    1. Notify the applicant that the Service is unable to certify the application because you cannot verify (via IDRS, a letter ruling or a determination letter) that the organization is exempt from taxation.

    2. Issue letter 3430.

  34. An organization whose entity contains one of the valid exemption status codes, or is confirmed as an exempt organization by a letter ruling or a determination letter, is considered an exempt organization. However, the Service cannot certify that the applicant as an exempt organization if IRS records show the applicant is required to file a return but did not.

    1. Notify the applicant that you cannot certify its application because the Service can not verify that the organization filed its required return.

    2. Issue letter 3444.

  35. An exempt organization that is denied certification and would like a reconsideration of its application for certification must contact:

    1. The Tax Exempt/Government Entity Division on 1–877–829–5500 to apply for exemption status, if denial was due to invalid EO status or if the account needs to be updated due to invalid filing requirements.

      Note:

      The Competent Authority (CA) may approve certification of the exempt organization applicant using general residency certification language, if application is forwarded to CA for reconsideration.

  36. Any exempt organization applicant that has had its application declined but believes it is entitled to U.S. Residency Certification, must submit a copy of the completed Form 8802, and attach a detailed explanation, including documentary evidence, as to why it believes it is entitled to certification.

    1. Reconsideration cases that have all items identified above are placed in status 702.

    2. Forward the entire case to HQ via P&A.

Employee Plans Applicants
  1. An employee plan sponsor or administrator is required to provide the following information on the Form 8802:

    • Application Information (the name and address of the trust is entered)

    • Applicant's TIN

    • Certified Name line (this is the name of the Benefit plan )

    • Mailing Address (if other than applicant's address)

    • Permanent Residence Address (when applicable)

    • TIA (when applicable)

    • Entity type

    • Tax form filed

    • Requested certification year (the year the organization wants printed on the Form 6166)

    • Tax period

    • Certification type

    • Country and number of certifications requested

    • Penalty of Perjury statements (when applicable), and

    • A signature of plan officer or the Pension Plan's POA and date, if a third party application

  2. Employee benefit plans/trusts must identify the type of retirement benefit plan and specify the plan number when applicable. Use plan number 001 for the following type plans:

    • Government plans

    • Church plans not electing coverage under IRC § 410(d)

    • Indian tribe plans

  3. An employee plan sponsor/employer is liable for filing a return in all instances except:

    • Church plans not electing coverage under IRC § 410(d)

    • A government plan

    • An unfunded excess benefit plan

    • A simplified employee pension (SEP) or a salary reduction SEP described in IRC § 408(k)

    • An annuity or custodial account arrangement under IRC § 403(b)(1) or (7) not established or maintained by an employer as described in 29 CFR 2510.3–2(f)

    • SIMPLE IRA under IRC 408(p)

    • An unfunded dues financed pension benefit plan that meets the alternative method of compliance provided by 29 CFR 2520.104–27

  4. The term plan sponsor means:

    • The employer, for an employee benefit plan that is established and maintained by a single employer

    • The employee organization, in the case of a plan for an employee organization

    • The association, committee, joint board of trustees, or similar group of representatives of the parties who established an employee benefit plan, when the plan is established by more than one employer.

      Note:

      In the case of multiple employee plans, if the plan is not sponsored by an association, committee, joint board of trustees, or similar group of representatives, the Form 8802 may have the name of one of the employee plans within the group (which is their sponsor) and the TIN of the master trust plan, or vice versa.

  5. The term plan administrator means:

    • The person or group of persons specified as the administrator by the instrument under which the plan operates

    • The plan sponsor or employer, if a sponsor hasn't been designated

    • Any other person prescribed by regulation when an administrator is not designated and a plan sponsor cannot be identified

  6. The following are certifiable employment codes. Use these codes in determining a federal, state, or local agency that is exempt or an Indian tribe that is not taxed under IRC § 501(c). Organizations with the following employment codes are considered government plans (see (3) above) and can be certified.

    • G - State or Local Government Agency

    • F - Federal Employer

    • T - State or local agency that has entered into a 218 agreement with SSA

    • I - Indian Tribes

    • W - A (501(c)(3) organization that is not liable under the Federal Unemployment Tax Act FUTA)

      Note:

      Certifiable only when the application is for an Indian tribe.

  7. When the applicant's account has a missing or incorrect Employment Code, process as follows:

    1. Prepare a Form 4442. Include the name of the organization, EIN and remarks indicating what is needed on the Form 4442, as well as IDRS screen prints.

    2. Fax the Form 4442 to the EO Clerical Unit using EEFax 855-214-7520.

    3. You must also advise the applicant to contact Employee Plans Office on 1–877–829–5500 to have the exemption status updated or corrected.

  8. The Form 5500 is used to report information concerning employee benefit plans, direct filing entities (DFEs), master trust investment accounts (MTIA) and fringe benefit plans.

  9. The Form 5500 must be filed every year for every:

    • Pension plan

    • Welfare benefit plan

    • Fringe benefit plan

    • Direct filing entity (DFE)

      Note:

      This information is covered in IRC § 6058, IRC § 6039D and Employee Retirement Income Security Act (ERISA) sections 104 and 4065.

    • Master Trust Investment Accounts (MTIA)

  10. A DFE includes plans that participate in certain trust accounts, and other investment arrangements. Some DFEs are required to file Form 5500.

    1. Master Trusts that are DFE(s) are required to file Form 5500.

    2. Master Trusts that are MTIA are required to file Form 5500.

    3. Common/Collective Trust (CCT), Pooled Separate Accounts (PSA), 103-12 Investment Entities, and group insurance arrangements are not required to file a Form 5500, however may decide to file a Form 5500 as a DFE.

  11. An IRC § 401(a) trust created and/or organized in the United States and forming part of a pension plan for the exclusive benefit of employees or their beneficiaries that have a 990–T-2 filing requirement is exempt from filing Form 5500.

    • Certify these applicants using one of the Form 5500 paragraphs.

    • Enter Plan number 001 in the Plan number field.

  12. In certifying the U.S. residency of an employee plan, it is necessary to verify that the administrator or sponsor of an employee benefit plan subject to ERISA (Employee Retirement Income Security Act of 1974) has filed an extension or one of the following returns:

    • Form 5500, Annual Return/Report of Employee Benefit Plan

    • Form 5500-EZ, Annual Return of One-Participant (owner and their Spouse) Pension Benefit Plan)

    • Form 5500-SF, Short Form Annual Return/Report of Small Employee Benefit Plan

    Note:

    When the certification application is for a common trust fund or pooled account, verify that each participant is a resident of the United States. Refer to trust procedures. See IRM 21.8.4.7.12.8.9, Common Trust Funds, for additional information

  13. When researching a fact of filing for certification of an employee plan, please note:

    • All plans and Group Insurance Arrangements required forms must be filed by the last day of the month 7 months after the end of the tax year.

    • Direct Filing Entities (DFEs) required forms must be filed no later than 91/2 months after the end of the tax year.

    Example:

    Employee Plan tax year that ends 12/31/2013 is due July 31, 2014; for a DFE it is due September 15, 2014.

  14. In certifying employee plans, group insurance arrangements, and DFEs that are required or have chosen to file a return, verify that the name and TIN of the entity that is requesting certification is included in the Form 5500 that was filed.

    If Then
    Form 5500 application shows a valid TIN but doesn't identify the Plan number Check TIN using CC INOLE(S) for a plan number and then check to see if it's a valid plan using CC lNOLE(P).
    Unable to locate a record of a valid plan number Request a signed and dated copy of the original Form 5500 identifying the plan using letter 3431.

    Note:

    The purpose of this request is to secure the TIN and Plan number.

    A copy of the original Form 5500 is received identifying the plan Verify that the plan listed matches the plan requesting certification.
    The plan listed on the Form 5500 matches the plan listed on the application Verify that the plan has filed or is not required to file using EMFOL(L).
    The plan filed the required Form 5500 Issue certification.
    The plan was not required to file Form 5500

    Note:

    Employment Codes G, T, F or 990–T-2 from INOLES, and Filing requirement of T on EMFOLL are exempt from filing

    Issue certification.
    The plan name listed on the Form 5500 doesn't match the plan name listed on the application Correspond for name change documentation using the letter 4064
    The requestor responds with the appropriate documentation for the plan name change Copy the name change documentation. Follow local procedures for forwarding the original name change documentation to Entity, maintain a copy with the certification application. Then check using CC EMFOL(L) to see if the TIN and plan has filed or is not required to file.
    The plan filed the required Form 5500 or was not required to file Issue certification, using the new name in the certificate name line field. Enter in the remarks field "Name change documentation forwarded to Entity."
    IDRS indicates the plan is required to file but the requestor disagrees

    Note:

    Employment Codes G, T, F and Form 990–T-2 from INOLES, and Filing requirement of T on EMFOLL filers are exempt from filing Form 5500.

    Refer the applicant to Customer Service Account Inquiry at 1-800-829–4933 or the TE/GE product line at 1–877–829–5500.
  15. In certifying Common/Collective Trust (CCT) and Pooled Separate Accounts (PSA) that are not required to file a Form 5500, verify that:

    1. The trust or account listed on the certification application has a valid IRS Determination Letter, such as the 1520 (81-100)

      Note:

      Group trust arrangement and Common Trust fund procedures are described in this IRM. See IRM 21.8.4.7.12.8, Trust Applicants, for additional information

      .

    2. Each participant in the group or pool is a resident of the United States. When these two items have been verified, issue certification.

  16. Certification applications must specify each Employee Benefit Plan number requesting certification, in addition to the standard requirements for Certification applications.

    Note:

    Ensure all requirements identified in IRM 21.8.4.7.12.13, Employee Plans Applicants, are met.

  17. When an applicant has not filed its initial return or claims it is not liable to file but requests certification, the applicant must provide:

    • An IRS determination letter or revenue ruling letter as proof the plan exists and is exempt from taxation and filing

    • A penalties of perjury statement, specifically stating that the organization was organized in the United States and carries out its exempt function primarily in the U.S.

  18. IRS Determination Letter or Revenue Ruling letter used as proof of exemption from taxation and filing, must specifically state that the organization is exempt from taxation and filing.

    If Then
    The requestor submits a determination letter or Revenue Ruling letter that states the organization is exempt from taxation and from filing Issue certification.
    The requestor submits a determination letter, that simply states the organization is exempt from taxation Check IDRS to determine filing status.
    IDRS indicates applicant is exempt from filing Issue certification.
    IDRS indicates the applicant is liable for the Form 5500 and a return was not filed Suspend the case; issue letter 3444.
    The plan cannot be verified It cannot be certified.
  19. When all requirements are met and verification that the organization is a valid employee plan, certify the applicant as an organization exempt from U.S. taxation under the appropriate IRC section.

  20. When all requirements are not met, correspond with the applicant using Letter 3431.

  21. An employee plan sponsor/employer is not required in all instances to apply for an Approval or Determination letter ruling.

    1. This type of requestor should file a return even though it is not required.

    2. If the sponsor/employer does not apply for an Approval or Determination letter ruling or file a tax return, the plan will not be found on any of our data bases.

    3. If the plan cannot be verified, it cannot be certified.

    4. Issue the letter 3431 to the Employee Benefit Plan Sponsor/Employer.

  22. Any employee plan applicant that has had its application declined, but believes it is entitled to U.S. Residency Certification, should submit a copy of the completed Form 8802, attach a detailed explanation, including documentary evidence, as to why it believes it is entitled to certification. Once you receive the application, place the case in status 702 and forward to HQ via P&A.

Specific U.S. Residency Certification Language for Specific Treaty Countries

  1. This section identifies specific treaty countries with which our Tax Treaty Department has agreed to provide specific U.S. Residency Certification language on the Form 6166 for income certifications and not Value Added Tax (VAT) certifications.

Certification Applications for the Commonwealth of Independent States
  1. For the purposes of applying the income tax treaties, the Commonwealth of Independent States includes:

    • Armenia

    • Azerbaijan

    • Belarus

    • Kyrgyzstan

    • Moldova

    • Tajikistan

    • Turkmenistan

    • Uzbekistan

  2. The Commonwealth of Independent States does not accept the usual wording on the Form 6166, Certification Program Letterhead.

  3. The U.S. Competent Authority has agreed to special language for the Commonwealth of Independent States certification. When certifying, use the paragraphs specifically established for Commonwealth of Independent States. For example, a corporation's certification for Azerbaijan would read "I certify that the above named corporation is a U.S. corporation, and a resident of the United States of America in the sense of the Income Tax Treaty between the U.S.S.R. and U.S.A. currently applied to the Republic of Azerbaijan, a member of the Commonwealth of Independent States."

  4. Georgia is no longer a member of the Commonwealth of Independent States; therefore, its certification should not make any reference to it. For example, a corporation's certification for Georgia should read "I certify that the above named corporation is a U.S. corporation, and a resident of the United States of America in the sense of the Income Tax Treaty between the U.S.S.R. and U.S.A. currently applied to Georgia."

  5. When all certification requirements have been met, issue certification.

Certification Applications for Greece
  1. Greece does not accept the usual wording on the Form 6166, Certification of U.S. Residency, as valid proof of U.S. residence.

  2. The U.S. Competent Authority has agreed to special language for the Greek certification. When certifying, use the paragraphs specifically established for Greece. All U.S. Residency Certifications for Greece must state that the applicant is: "A resident of the United States of America for purposes of the Greece - U.S.A. Double Taxation Convention."

  3. When the certification is complete, mail Form 6166 to the applicant and the authorized representative.

Certification Applications for Russia
  1. Russia requires specific wording on the Form 6166, Certification of U.S. Residency, as valid proof of U.S. residence.

  2. The U.S. Competent Authority has agreed to Russia's specific language. Russian certification requires the use of the paragraphs specifically established for Russia. The U.S. Residency Certification for Russia must state that the applicant is: "A resident of the United States of America in the sense of the Double Tax Treaty between the Russian Federation and the United States of America."

  3. When all of the certification requirements have been met, issue certification.

Certification for Spain and Portugal
  1. Spain and Portugal require specific wording on the Form 6166, Certification of U.S. Residency, as valid proof of U.S. residence.

  2. The U.S. Competent Authority has agreed to Spain's and Portugal’s specific language. The certification from either Spain or Portugal requires the use of the paragraphs specifically established for Spain or Portugal. The U.S. Residency Certification for Spain must state: "I certify that, to the best of our knowledge, the above-named taxpayer is a resident of the United States within the meaning of the United States - Spain Income Tax convention”. The U.S Residency Certification for Portugal must state: ”I certify to the best of our knowledge, the above-named taxpayer is a resident of the United States within the meaning of the United States - Portugal Income Tax convention”."

  3. When all of the certification requirements have been met, issue certification.

Foreign Claim Forms and/or Procedures

  1. This section identifies some of the Foreign Claim Forms and/or procedures included in processing Form 8802.

  2. All U.S. Residency Certification applications MUST include a Form 8802.

  3. The foreign claim box must be checked if a foreign claim form is included with Form 8802. When a foreign form is attached, it must stay with the application until it can be associated with:

    • Form 6166, or

    • The rejection letter

    Note:

    When processing foreign claim forms, check the foreign claim form box on the data input screen to assure the certification is printed locally.

  4. The IRS has agreed to include the following countries' claim forms in the U.S. residency certification process:

    • Belgium

    • Denmark

    • France

    • Kazakhstan

    • Portugal

    • The United Kingdom

  5. Foreign Claim Forms and/or procedures not mentioned in this section or any other section within the certification procedures, are returned to the applicant. Do not alter the form in any way. This includes date stamping. Do NOT date stamp these forms.

    Note:

    When returning Foreign Claim Forms to the applicant, include Notice 1435, U.S. Certification Foreign Forms

    Caution:

    Extreme care must be taken to ensure that only the material relative to the taxpayer(s) to whom the correspondence is addressed is enclosed in the envelope. See IRM 21.3.3.4.25, Breaches of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors.

    1. When an applicant is persistent about processing a form that is not listed, notify the Planning and Analysis analyst.

    2. The management analyst will forward the issue to the Headquarters analyst.

    Note:

    The IRS has an agreement to certify forms from Canada, although their forms are not listed.

Certification Applications for the United Kingdom (U.K.)
  1. The U.K. income tax treaty that entered into force on March 31, 2003 changed our certification process. The U.S. Residency Certification process does not require the submission of the United Kingdom forms in order to receive U.S. Residency Certification. The requestor must ascertain what they are required to provide the U.K. to obtain treaty benefits.

  2. Copies of the latest U.K. forms can be obtained using the following web address:

    https://www.gov.uk/government/collections/international-tax-forms

  3. Applicants requesting certification under the U.K. income tax treaty can obtain the appropriate forms using the following web addresses:

    http://www.hmrc.gov.uk/cnr/us_comp.pdf.
    http://www.hmrc.gov.uk/cnr/us_individual_2002.pdf
    http://www.hmrc.gov.uk/cnr/uk-reit-dt-individual.pdf
    http://www.hmrc.gov.uk/cnr/us-company-uk-reit.pdf

  4. Additional guidance can be found at:

    http://www.hmrc.gov.uk/home.htm

  5. Requestors that are not certain as to their needs, or have questions on the new forms or process, can phone the U.K. during office hours. If calling from outside the U.K., call 44 151 210 2222. If calling from the U.K., call 0845 070 0040. Those preferring to write to HM Revenue and Customs should address their letters to the following address:

    Inland Revenue-Centre for Non-Residents,
    Fitz Roy House, PO Box 46, Nottingham,
    England NG2 1BD.

  6. The following are some examples of the certification forms for the United Kingdom.

    • Form U.S./Company - a claim form for use by a United States domestic company, Mutual Fund, Pension Scheme, Charitable Organization, or Trust, receiving interest and royalties arising in the United Kingdom.

    • Form U.S./Individual 2002- a claim form for use by an individual who is a resident of the United States receiving pensions, incapacity benefit, purchased annuities, interest or royalties arising in the United Kingdom after May 1, 2003.

  7. When processing certification applications for the U.K., the processing procedures depend upon whether or not the requestor submits a U.K. claim form.

    1. If an application for certification for the United Kingdom (U.K.) is received and... Then ...
      Form was submitted, application is eligible All U.S. income tax certification applications accompanied by a U.K. form must be forwarded directly to the U.K.
      A U.K. form was not submitted Issue Form 6166 if all other certification requirements are met
      Form was submitted, application is eligible, the applicant wrote “see Attachment” or “see Appendix 1” on any line items and there is an attachment
      • Place a checkmark in the box labeled “Form 6166 attached”

      • Date stamp the form with the date of the Form 6166 certificate

      • Input the following note on USRC system “Attachment to U.K. Form included and mailed to U.K.”

      • Forward Form 6166 Certificate, U.K. Form and attachments directly to the U.K.

      Form was submitted, the applicant wrote “see Attachment” or “see Appendix 1” on any line items and the attachments aren’t stapled to the U.K. Form or clearly identified as an attachment to the U.K. Form
      • The applicant must be contacted to request the missing attachments. First attempt to reach the applicant via telephone.

        Note:

        Input the following note on USRC system “Attachment to U.K. Form not included (spoke/corresponded) with applicant on MM/DD/YYYY.”

      • If you cannot reach the applicant on the telephone, place the record in 702 status and suspend the case for 30 days (60 days International).

      • Send the applicant a 4064C Letter with the following open paragraphs:
        Open Paragraph 3: The U.K. Foreign Form attached to your application includes a notation “see Attachment” or “see Appendix 1.” There weren’t any attachments stapled to the U.K. Form or clearly identified as an attachment included in your application. Please submit the attachments to us in order to process the U.S. Certification for U.K.
        Floating Paragraph *: If you have requested U.S. Certifications for other countries and the application is eligible, we will send all other residency certifications in about 10 to 12 business days through normal printing and processing methods.

        Note:

        Input the following note on USRC system “Attachment to U.K. Form not included (spoke/corresponded) with applicant on MM/DD/YYYY.”

      • If the applicant requested other countries, and the applicant is eligible, issue the certificates for those countries.

      • If the taxpayer doesn’t reply after 30 days (60 days International) close the case following procedures in IRM 21.8.4.6.4, Working Status Reports.

      It is in response to the IRS requesting attachments Associate the U.K. Forms to the original application and process

      Note:

      If a Form 8802 requests a U.K. certification, and certification for other countries, a separate record must be established for the U.K. certification. The U.K. cover letter must be checked on the input screen to print the U.K. cover letter locally.

  8. The IRS will send confirmation of certified U.K. claim forms only to requestors that submit three copies of their claim form, along with a self-addressed stamped envelope.

  9. U.K. ACT Claim forms are generally filed in duplicate with the Philadelphia campus when the first claim is filed for the certification period. All subsequent claims for the same certification period can be sent directly to the Inspector of Inland Revenue - Centre for Non-Residents, Fitz Roy House, P.O. Box 46, Nottingham, England, NG2 1BD.

  10. U.K. claims forms that are filed in duplicate at the Philadelphia campus are retained by the U.S. residency unit for six months.

    If... Then...
    Only one form is submitted by the applicant Check 6166 database for a prior certification.
    A prior certification is located for the certification period Forward the form to the Director of Foreign Dividends without certification.
    A prior certification is not located for the certification period Certify, if eligible, and forward to the U.K.
  11. Multiple tax years may be received on one form filed by an applicant. Certify each tax year requested.

Certification of French Forms
  1. The French tax authorities require that their forms be handled in accordance with the instructions on their forms.

  2. All original copies submitted by the U.S. applicant are completed as appropriate by the campus. Return the original forms to the U.S. person.

    Note:

    A photocopy of the completed form is retained for six months.

  3. The French Form 5000–EN is used with the Form 6166 to certify U.S. residency for tax purposes. The Form 5000–EN will generally be accompanied by either a Form 5001–EN, 5002–EN, or 5003–EN depending on the type of income.

  4. Verify the applicant's residency (the applicant has filed the required U.S. tax return):

    1. Stamp the Field Director's signature and seal the French Form 5000–EN in part IV, and

    2. Generate and attach the Form 6166 to the French form.

  5. If a current year application, and the applicant meets all current year requirements, you can issue certification:

    1. Stamp the Field Director's signature and seal the French Form 5000–EN in part IV, and

    2. Generate and attach the Form 6166 to the French form.

  6. A separate Form 5000–EN is required for each category of income:

    • Form 5001 — dividend income

    • Form 5002 — interest income

    • Form 5003 — royalty income

      Note:

      A Form 5000–EN can be certified without other forms.

  7. Return the signed and sealed copy of the Form 5000–EN with the Form 6166 to the applicant. Extreme care must be taken to ensure that only the material relative to the taxpayer(s) to whom the correspondence is addressed is enclosed in the envelope. See IRM 21.3.3.4.25, Breaches of Personally Identifiable Information (PII) Caused by Manual Stuffing Errors. Attach the Form 6166 to the Form 5000–EN. The Form 6166 provides the applicant's name and tax identification number requested in part IV of the Form 5000–EN. The signature stamp and seal are the only entries necessary in part IV of Form 5000–EN.

    Note:

    Part IV of Form 5000–EN indicates the beneficiary of the income is subject to taxation. The Service has a separate agreement with France that clarifies this language. The Service is only certifying the applicant is a resident of the U.S. for tax purposes. The Service not making a determination that the applicant is the beneficial owner of the income.

Certification Applications for Portugal
  1. The Service has agreed with the Portuguese Tax Administration's request that the IRS certify (stamp and seal) their forms, in addition to providing a Form 6166, U.S. Residency Certification.

  2. Certify four Portuguese tax forms that have been in effect since January 1, 2008:

    • Form MOD.21–RFI (Request for total or partial exemption from withholding of Portuguese tax)

    • Form MOD.22–RFI (Request for repayment of Portuguese tax on dividends from stocks and interest from debt securities)

    • Form MOD.23–RFI (Request for repayment of Portuguese tax on royalties, dividends, and interest — except for dividends from stocks and interest from debt securities)

    • Form MOD.24–RFI (Request for repayment of Portuguese tax on other income)

  3. Each of the forms identifies the applicant as the beneficial owner of the income included on the form. Important: The purpose of the Certification process does not certify the beneficial owners of income; it certifies only the residency of the applicant. This statement is excluded from the Form 6166 certification.

  4. Applicants submitting Portuguese forms for certification must first meet the requirements specified for the type of entity submitting the application. If all of the application requirements and certification residency requirements are met:

    1. Generate the Form 6166, and

    2. Process the Portuguese form in accordance with the procedures below and return it with the Form 6166.

  5. In the section for Certification by the Competent Tax Authorities of the Beneficial Owner's State of Residence, apply:

    • Field Director's signature stamp

    • Date stamp

    • IRS address stamp

    • Seal

Additional Foreign Country Claim Forms
  1. This section identifies the Foreign Claim Forms and countries that are not mentioned in the previous instructions.

  2. These are additional countries for which the IRS has a formal agreement for certification.

  3. The following forms are not required to be signed or sealed by an IRS official. Issuing the Form 6166 is all that is required of the IRS.

    1. Denmark (U33), Claim to Relief from Danish Dividend Tax. This form requires self-statement by U.S. resident.

    2. Germany DBA/U.S.A. 5000 - Applicant for refund states he had residence in the United States.

    3. Netherlands - Applicant self-certifies as to U.S. residency.

    4. Switzerland 82 series forms - Claim of refund of Swiss tax withheld at source on dividends and interest derived from sources within Switzerland. Requires notarized signature of claimant.

    5. Ireland - All claim forms specifically state that all that is required for each year claimed is a Form 6166 from the Internal Revenue Service.

    6. Finland - Form 6113a – Declaration Concerning Relief From Finland Tax at Source, no longer requires certification; the Form 6166 may be used to comply with the new requirements .

  4. Sign (stamp) and seal all foreign tax forms when requested (form specifies) by the foreign country and the Competent Authority has agreed to certify the form.

  5. The following charts indicate additional foreign countries and their specific tax forms:

    Belgium

    These forms require that you stamp the date, the Director's signature, and the IRSseal.

    Exception:

    Forms for the current year must only be date stamped, and the Form 6166 must be issued.

    Form 276 Int - Request for Reduction of the personal-property prepayment on interest, pursuant to the Convention between Belgium and the United States.
    Form 276R - Request for Exemption of the personal-property prepayment on royalties, pursuant to the Convention between Belgium and the United States.

    Note:

    Belgium has various forms in the 276 series that we can certify.

    Kazakhstan
    Certificate of permanent residence.
    Luxembourg
    LUX 1 - Claim for Refund of 50 percent of Luxembourg Capital Yields Tax on Dividends and of Full Luxembourg Capital Yields Tax on Interest (Articles IX (1)(a) and VIII of the Double Taxation Convention with the United States)
    LUX 2 - Claim for Refund of 66 percent of Luxembourg Capital Yields Tax on Dividends under the Double Taxation Convention with the United States (Article IX(1)(b) of the Convention)
    LUX 3 - Claim for Exemption of Luxembourg Tax on Royalties for the Use of Industrial Licenses and Copyrights under the Double Taxation Convention with the United States of America (Article VII of the Convention)
    LUX 4 - Claim for Refund of Luxembourg Tax on Royalties for the Use of Industrial Licenses and Copyrights under the Double Taxation Convention with the United States of America (Article VII of the Convention)

Certification Applications for Refund or Exemption from Value Added Tax (VAT)

  1. The following section has information pertaining to the processing of Value Added Tax (VAT) Certification.

An Overview of VAT Certification

  1. These procedures are for cases when we are asked to furnish evidence that a citizen, resident, or entity of the United States has filed a U.S. income tax return and that the return lists a business activity or that the entity represents that it is involved in a certain business activity. The purpose of such evidence is to assist foreign countries that have a VAT system in determining an applicant's right to a VAT refund or an exemption from VAT.

VAT - General information

  1. Value Added Tax is assessed on goods and services in many foreign countries. However, foreign tax laws often provide that this tax applies only to residents of the foreign country, not to individuals or companies residing outside of the foreign country. Therefore, U.S. citizens or residents who do not reside in the foreign country can apply for a refund of the VAT. VAT certification will either certify the type of NAICS code the applicant listed on the return it filed, or it will identify the NAICS code for the business as represented by the applicant.

  2. Countries that have VAT may require that IRS furnish evidence that a citizen, resident, or entity of the U.S. has filed a U.S. income tax return. They may also require that the person who filed is involved in a business activity.

VAT Certification Applications

  1. When VAT certification applications are received, the Service validates the applicant's:

    • Name

    • Address

    • Identification number

    • Filing of a U.S. tax return

    • Business activity code and business activity

  2. When processing a VAT certification application:

    If Then
    The provided NAICS code is invalid Correspond for a valid NAICS code using the Letter 3437.
    The applicant responds with a valid NAICS code Process the application.
    The NAICS code matches the code posted on the applicant's tax return (status code 099) Issue the appropriate VAT certification paragraph.
    The applicant responds, or submits with the original application, a NAICS code that differs from the one posted on the return (system returns Status Code 360), but you can validate the NAICS using the help screen Override the Status Code 360 to 000, removing the case from the database and issuing certification using the applicant representation paragraphs on Excel.

Processing VAT Certification Applications

  1. Follow the procedures used for processing U.S. Residence Certifications. See IRM 21.8.4.6, The Certification Process, for additional information.

Researching for Tax Authorization

  1. Follow the Tax Information Authorization procedures for U.S. Residence Certification. See IRM 21.8.4.5, Tax Information Authorizations (TIAs), for additional information.

Researching and Certifying the Fact of Filing and Business Activity for VAT Certificates

  1. The procedures for researching and certifying the fact of filing for VAT certifications are the same as those for Income Tax Certification in IRM 21.8.4.7.12, Applicant Requirements, Return and U.S. Residency Certification Information, except for the following:

    1. Claim forms from foreign countries cannot be used for VAT certification.

    2. Use the Form 6166 with the additional VAT language for all VAT certification applications.

  2. Forms, documents, or claims for refund from foreign countries may be submitted for Value Added Tax (VAT) certification by the applicant, but a Form 8802 must accompany it.

    1. Do not stamp or seal claim forms from foreign countries during the VAT certification process.

    2. In all cases, when the applicant meets the VAT requirements, the Form 6166 will be generated and attached to the front of the foreign country's form.

    3. VAT certification applications must have a business activity; if none submitted, deny the application.

      Note:

      Any applicant requesting a VAT certification, but not having a business activity, may request and receive a residency certification when all requirements have been met.

  3. In addition to the procedures discussed above, VAT certifications also require validation of the applicant's NAICS code. See U.S. Residency Certification database help screen. See IRM 21.8.4.8.3, VAT Certification Applications, for additional information.

  4. For individuals, this is verified by the Schedule C or F indicator and the NAICS Code.

    1. The Schedule C or F indicator establishes that the applicant has a business activity, and

    2. The NAICS code describes the activity.

  5. Certify all applicants by using the U.S. Residency certification procedures and requirements found in IRM 21.8.4.7.12.

    Exception:

    Individual Applicants, IRM 21.8.4.8.7.

  6. When the required information requested in IRM 21.8.4.6.8 above is received and validated, and the tax module indicates that a return was filed, a certification can be issued.

  7. Send completed VAT certification to the applicant or the authorized representative requesting the certification.

Individual Applicants

  1. The Service researches its records for evidence of the applicant filing Form 1040 for the year certification is based. The tax module must indicate the presence of Schedule C and/or F indicator.

    If Then
    No record of a filing, the tax module does not indicate the presence of Schedule C and/or F indicator There is no record of a business activity code. Initiate the Letter 3437C or letter 3426C, whichever is applicable.
    The applicant indicates that a return was filed The applicant must provide a copy of the latest return with a written statement made under penalties of perjury stating the applicant’s business activity.
  2. When the copy of the applicant's return is received, check the return to see if it was filed under a different TIN. If a different TIN is found, then enter the application using the account information on the copy of the return.

    Exception:

    Third party applications require a new authorization identifying the new account as an account from which the third party can receive information.

    1. If the tax module indicates that a return was filed, but it does not show a Schedule C or F indicator, a certification as to the business activity cannot be issued.

    2. If the applicant's copy contains a Schedule C or F, notify the applicant to amend their filing. The business activity cannot be certified until the filing is amended but a U.S. Residency certification can be issued if requested by the applicant.

  3. Once all of the required information has been gathered, process VAT application.

Denial of an Application

  1. Nonresident aliens and foreign corporations do not qualify for a VAT certification.

  2. United States citizens who are bona fide residents of foreign countries generally do not qualify for a VAT certification.

  3. When denying these applications, send a letter to the applicant stating that, "According to our records, you are a nonresident alien or a bona fide resident of a foreign country. Therefore, we cannot provide you with a VAT certification."

  4. Applicants requesting VAT certification do not qualify, unless they have a business activity. When denying these applications, send a letter to the applicant stating that:

    "VAT certification procedures require that you have a business activity and our records do not show a business activity. Therefore, we cannot provide you with a VAT certification."

Value Added Tax Certification

  1. The campus is only certifying that the person in question has filed the U.S. return that is statutorily required from a U.S. citizen or resident alien and/or that the return listed or the applicant represents a business activity, product or service.

  2. Upon receipt of an acceptable certification application, the Campus Director certifies that:

    1. The applicant has produced a copy of the most recent income tax return, or

    2. Other acceptable information in those cases in which research does not indicate a record of filing; and to

    3. The presence or absence of a business activity, product or service on the applicant's return.

U.S. Certification Letter Types and Suspense Codes

  1. Use the following chart to determine the letter type and status codes to use when corresponding with taxpayers. The letters listed in the below table are issued utilizing the IAT Tool.

Letter Number Title / Description Type Of Letter IMF BMF Both Status Code
Letter 3425C Taxpayer is a Bona Fide Resident of a Foreign Country or Possession Reject X 000
Letter 3426C No U.S. Tax Return On File For The Requested Year (Individual/ Possible Minor Child Suspense X 702
Letter 3427C Third Party Request/Requestor Not Authorized Reject X 000
Letter 3429C Partnership - Required F8802 Application Information Needed For Partnership Suspense X 702
Letter 3430C Exempt Organization - Required F8802 Application Information Needed For An Exempt organization Suspense X 702
Letter 3431C Employee Plans (EPMF) - Required F8802 Application Information Needed For An Employee Benefit Plan Suspense X 702
Letter 3432C Abandonment Letter Closed X 199 / 000
Letter 3436C Requested Certification Form is not Eligible for U.S. Residency Certification Reject X 000
Letter 3437C Principal Business Activity Discrepancy - Value Added Tax (VAT) Suspense X 702
Letter 3440C U.S. Residency Interim Letter- System generated Interim X
Letter 3441C S Corp – Required F8802 Application Information Needed for an S Corporation Suspense X 702
Letter 3442C S Corp – None of the Shareholders Filed, or One Filed F1040NR Reject X 000
Letter 3443C Partnership Filing Discrepancy Suspense X 702
Letter 3444C No U.S. Tax Return On file For The Certification Year Requested - BMF Suspense X 702
Letter 3445C No Return Filed – T/P Deceased Reject X 000
Letter 3446C Resident Alien VISA Holders - Request for 1040 Filing Explanation Suspense X 702
Letter 3536C Required F8802 Current Year Application Information Needed For A Pass-through Entity Suspense X 702
Letter 3633C Required F8802 Current Year Application Information Needed For A Single Member LLC Suspense X 702
Letter 3634C Required F8802 Current Year Application Information Needed Suspense X 702
Letter 3635C Required F8802 Application Statement Needed For A Newly Formed Single Member LLC Suspense X 702
Letter 3636C Certification Country Required F8802 Application Suspense X 702
Letter 3637C Required F8802 Application Information Needed For A Second Tier Pass-through Entity Suspense X 702
Letter 3644C F8802 Application Requires Country of Incorporation For A Dual Residence/Dual Incorporated Corporation Suspense X 702
Letter 4056C Required F8802 Application Information Needed For Form 1116 Filer Suspense X 702
Letter 4057C U.S. Residency Certification Declined – Possible Foreign Corporation Reject X 000
Letter 4058C Required F8802 Application Information Needed For Additional Request Suspense X 702
Letter 4059C Required F8802 Application Information Needed For First Year Resident Suspense X 702
Letter 4060C U.S. Residency Certification – No S Corporation Shareholders Filed Suspense X 702
Letter 4061C U.S. Residency Certification - Sole Proprietor No Schedule C Filed Suspense X 702
Letter 4062C Required F8802 Application Information Needed For A Nominee Suspense X 702
Letter 4063C U.S. Certification Declined - Possible Foreign Residence Reject X 000
Letter 4064C Incomplete F8802 Application Suspense X 702

Note:

Additional information on Letters and Status codes is located in IRM 21.8.4.7.9, IRS Initiated Correspondence - Guidelines, and IRM 21.8.4.6.4, Working Status Reports.