Regulations Reducing Burden Under FATCA and Chapter 3
Summary
SIFMA provides comments to the Internal Revenue Service (IRS) and the Department of the Treasury on the proposed regulations to reduce burdens under the Foreign Account Tax Compliance Act (FATCA) and chapter 3 of the Internal Revenue Code.
Excerpt
February 22, 2019
Mr. John Sweeney
Branch Chief, Branch 8
Office of Associate Chief Counsel, International
Internal Revenue Service
1111 Constitution Avenue, NW
Washington, DC 20224
Ms. Nancy Lee
Senior Technical Reviewer, International Tax Affairs
Department of the Treasury
1500 Pennsylvania Ave, NW
Washington, DC 20220
Mr. Subin Seth
Senior Counsel
Office of Associate Chief Counsel, International
Internal Revenue Service
1111 Constitution Avenue, NW
Washington, DC 20224
Re: Regulations Reducing Burden Under FATCA and Chapter 3 [REG-132881-17]
Dear Ladies and Gentlemen,
The Securities Industry and Financial Markets Association (“SIFMA”)1 is pleased to submit comments on the proposed regulations to reduce burdens under the Foreign Account Tax Compliance Act (“FATCA” or “chapter 4”) and chapter 3 of the Internal Revenue Code (the “Code”). Notably, we greatly appreciate the elimination of gross proceeds from the definition of the term “withholdable payment” under § 1.1473-1(a)(1). Removal of this withholding requirement lifts an enormous compliance burden from withholding agents and will avert market disruption. SIFMA also appreciates removal of the problematic mismatch associated with the lag method, restriction of the definition of an “investment entity,” and the deferral of withholding on foreign passthru payments. These provisions represent a significant burden reduction for SIFMA member firms complying with FATCA. There are a few provisions on which SIFMA would like to provide additional comments.