Regulations Reducing Burden Under FATCA and Chapter 3

Published on:
February 22, 2019
Submitted to:
IRS, Treasury
Submitted by:
SIFMA

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.

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