FATCA – Form W-9 and instructions for TIN requests, certification
November 10: The IRS has posted a draft version (as of November 7, 2014) of Form W-9, Request for Taxpayer Identification Number and Certification, and a draft version of the instructions for a requester of Form W-9.
Read the draft Form W-9 [PDF 109 KB] and the draft instructions [PDF 245 KB]
Form W-9 is used to request a taxpayer identification number (TIN) of a U.S. person (including a resident alien) and to request certain certifications and claims for exemption. Failure to comply with Form W-9 can result in backup withholding.
The draft instructions explain that FATCA requires a participating foreign financial institution to report all U.S. account holders that are specified U.S. persons, and notes that there is an “exemptions box” on the front of the form that includes a space for entry of the exempt payee code (if any) and for claiming an exemption from FATCA reporting code (if any).
KPMG observation
In general, it appears that the principal changes in the draft versions of Form W-9 and the instructions would affect U.S. payors that create substitute forms. The instructions require the fourth certification concerning FATCA codes, even though those codes are not relevant if the person is providing Form W-9 to a U.S. payor.
IRS personnel previously said that they were “sympathetic” because the instructions required the fourth certification regardless—a statement that tax professionals interpreted to mean the IRS apparently was not planning on updating the instructions just to reflect this reporting glitch.
However, with the release of the draft Form W-9 and instructions, the IRS in fact is updating the instructions. Yet, the requirement relating to the FATCA codes has not been removed—even if the person requesting the form is a U.S. payor. Instead the instructions now state that the certification is not relevant if the requestor is U.S. payor, which as some tax professionals have observed is not particularly helpful guidance.
The draft Form W-9 and instructions for 2014 are subject to change and to OMB approval before being officially released.
