SIA Submits Comments to the IRS on US Withholding Tax Imposed on Certain Dividends

The Securities Industry Association (SIA) provides comments to the Internal Revenue Service (IRS) on the U.S. withholding tax imposed on certain dividends paid to Puerto Rico.Specifically, SIArequests guidance concerning the implementation of the new beneficial reductions in the withholding tax, Section 1442(c)(2)(A) of the Internal Revenue Code (the Code).

U.S. withholding agents must meet specific documentation standards. Thecurrent documentation, Form W-8BEN, does not capture the required information to apply the lower withholding tax rate.
SIA offers alternative guidance that would sufficiently modify the form; and an interim procedure to fill the time prior to the release of the new Form W-8BEN.

*SIFMA is the product of a merger between the Securities Industry Association (SIA) and The Bond Market Association (TBMA) in 2006.