Withholding on U.S. Source Income Paid to Foreign Persons

Internal Revenue Code

Final Withholding Regulations (general effective date: January 1, 2001)

Revisions to Regulations Relating to Withholding of Tax on Certain U.S. Source Income Paid to Foreign Persons and Revisions of Information Reporting Regulations (T.D. 9253, March 13, 2006)

Proposed Withholding Regulations - Preamble

Temporary and Final Regulations (pre-2001 withholding regulations)

Treaty Provisions

Canada-U.S. Treaty, Article XVII (Withholding of Taxes in Respect of Personal Services)

Court Decisions

Del Commercial Properties, Inc. v. Commissioner, 251 F.3d 210 (D.C. Cir. 2001), aff'g T.C. Memo. 1999-411 (section 1442)

Medieval Attractions N.V. v. Commissioner, T.C. Memo. 1996-455 (court sustained penalties against domestic corporation for failure to withhold on payments made to foreign entities and individuals)

Central de Gas de Chihuahua v. Commissioner, 102 T.C. 515 (1994) (actual receipt of FDAP payment not necessary under section 881; deemed payment subject to withholding)

Casanova Co. v. Commissioner, 87 T.C. 214 (1986) (Form 1001, dated 1984, claiming treaty exemption with respect to 1980 interest payments, held timely despite contrary IRS position in Rev. Proc. 79-40, 1979-2 C.B. 504)

Other Materials

Rev. Proc. 2004-59, 2004-42 C.B. 678 Section 1441 Voluntary Compliance Program

IRS Publication 515 - Withholding of Tax on Nonresident Aliens and Foreign Entities (Rev. January 2005)

PLR 9806012 (Distributions to German beneficiary not subject to withholding)

GCM 39888 (Section 6662(b)(2) substantial understatement penalty applies to Form 1042; Prior inconsistent GCM revoked)

Davis and Stirling, Withholding Tax Rules for Outbound Payments Rewritten by IRS in New Proposed Regulations, 85 J. Tax'n 173 (1996)

Rev. Proc. 89-31, 1989-1 C.B. 895, as modified by Rev. Proc. 92-66, 1992-2 C.B. 428

Dale, Withholding Tax on Payments to Foreign Persons, 36 Tax L. Rev. 49 (1980)

TAM 7701299430A (Noncompliance penalties cannot be imposed where income treaty exempt; compare Treas. Reg. 1.1441-1(b)(7))

Relevant IRS Forms

Instructions for the Requester of Forms W-8BEN, W-8ECI, W-8EXP, and W-8IMY (Rev. August 2003)

Form W-8BEN Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding (Rev. December 2000)

Instructions for Form W-8BEN (Rev. January 2003)

Form W-8ECI Certificate of Foreign Person's Claim for Exemption From Withholding on Income Effectively Connected With the Conduct of a Trade or Business in the United States (Rev. December 2000)

Instructions for Form W-8ECI (Rev. December 2003)

Form W-8EXP Certificate of Foreign Government or Other Foreign Organization for United States Tax Withholding (Rev. December 2000)

Instructions for Form W-8EXP (Rev. August 2001)

Form W-8IMY Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding (Rev. December 2003)

Instructions for Form W-8IMY (Rev. December 2003)

Form SS-4 Application for Employer Identification Number (Rev. December 2001)

Instructions for Form SS-4 (Rev. September 2003)

Form W-9 Request for Taxpayer Identification Number and Certification (Rev. January 2005)

Instructions for the Requester of Form W-9 (Rev. October 2004)

Form 843 Claim for Refund and Request for Abatement (Rev. November 2002)

Form 1000 Ownership Certificate (Rev. August 1997)

Form 8233 Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual (Rev. December 2001)

Form 1042 Annual Withholding Tax Return for U.S. Source Income of Foreign Persons (2004)

Form 1042-T Annual Summary and Transmittal of Forms 1042-S (2004)

Form 1042-S Foreign Person's U.S. Source Income Subject to Withholding (2005)

Instructions for Form 1042-S (2005)

Form 4224 Exemption From Withholding of Tax on Income Effectively Connected With the Conduct of a Trade or Business in the United States (Rev. August 1998)

Form 8804 Annual Return for Partnership Withholding Tax (2004)

Form 8805 Foreign Partner's Information Statement of Section 1446 Withholding Tax (2004)

Form 8813 Partnership Withholding Tax Payment (Rev. February 2001)

Instructions for Forms 8804, 8805 and 8813 (2004)

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