Consulting

CTI offers consulting services to help clients comply with tax withholding and information reporting rules for all types of fixed and determinable payments, financial products and investment vehicles. CTI works closely with Burt, Staples & Maner, LLP (BSM), a law firm with offices in Washington D.C. and London, specializing in international tax issues.

Typical engagements have included:

Impact Analysis and Health Check

• Conducting an impact analysis to assess the client's level of compliance with respect to its U.S. tax withholding and information return reporting requirements, specifically focusing on providing recommendations as to whether the current systemic and operational procedures utilized by the client are in compliance with the 1441 regulations.
• Performing a top-to-bottom health check of the client's systems for tax withholding and information reporting, identifying any areas of noncompliance or heightened risk.
• Download the Impact Analysis & Health Check Brochure.

Audits and Remediation

• Reviewing tax documentation to determine validity and implementing a process to cure defective forms.
• At the direction of the client's tax counsel, organizing and preparing materials for use in an IRS audit or potential litigation.
• Download the Audit Defense & Remediation Brochure.

QI Services

• Conducting health checks and training to ensure compliance and remediate issues.
• Perform QI audits (CTI and BSM are approved QI auditors).
• Assisting with QI applications, FATCA preparation, and litigation.
• Download the QI Services Brochure.

Multi-national Corporation Consulting

• Conducting health checks and training to ensure compliance and remediate issues.
• Providing audit assistance in response to Information Disclosure Requests (“IDR”) from the IRS and assist in minimizing or eliminating any exposure.
• Validating Forms W-8, Forms W-9, and Forms 8233, communicating with vendors, calculating withholding rates, providing TIN matching services, preparing procedure and operations manuals, producing year-end reporting, and preparing tax returns through our outsourcing group.
• Assisting and preparing ITIN applications as a Certifying Acceptance Agent.
• Download the Multi-national Corporation Brochure.

Certifying Acceptance Agent

CTI, as a Certifying Acceptance Agent, is authorized to:

• Assist foreign individuals, who are ineligible or unable to receive a Social Security Number, in obtaining an Individual Taxpayer Identification Number (ITIN) or an Employer Identification Number (EIN).

As a Certifying Acceptance Agent, CTI can:

• Meet with and assist the applicant in completing the IRS Form W-7, Application for IRS Individual Taxpayer Identification Number.
• Review the required documentation to verify a foreign individual's status and identify and submit the application on behalf of the foreign individual.
• Certify to the IRS that the foreign individual's application is complete, accurate and that the documentation provided to us for review is authentic, eliminating the need for the original identifying documents being submitted to the IRS with the application.
• Receive the individual's ITIN directly from the IRS and communicate with the IRS on behalf of the foreign individual on matters relating to the issuance of an ITIN. We offer this service to our clients and foreign nationals to assist in the compliance with IRS withholding regulations and assist individuals and other entities who are eligible to obtain the benefit of a reduced withholding under an income tax treaty and in completing Forms W-8 and 8233.

Client Letters

• IRS Comments at Recent Conferences    
  (May 17, 2013)
  The Executive Enterprise Institute's 25th Annual Forum on International Tax Withholding and Information Reporting held recently in New York was an opportunity for the IRS to share the latest government developments regarding the Foreign Account Tax Compliance Act ("FATCA") and also...
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• New IGA Models    
  (May 10, 2013)
  Late yesterday the U.S. Treasury posted revised Model Intergovernmental Agreements and Annexes for FATCA. You can obtain copies from the Treasury website ...
  Learn More.
• Cost Basis Reporting    
  (April 25, 2013)
  IRS finalized regulations expanding cost basis reporting to debt obligations and options. These regulations substantially increase the degree of difficulty for brokers, custodians, issuers and others who may hold or transfer securities on behalf of others. Moreover, the first phase of these new regulations goes into effect...
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• IRS Publishes 2014 Draft Form 1042 Including FATCA and Dividend Equivalent Items    
  (April 10, 2013)
  The IRS published late yesterday a draft Form 1042, "Annual Withholding Tax Return for U.S. Source Income of Foreign Persons," to cover FATCA...
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• IRS Releases Draft FATCA Registration Form 8957    
  (April 08, 2013)
  IRS released the attached draft Form 8957, “Foreign Account Tax Compliance Act (FATCA) Registration” for foreign...
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• IRS Publishes Draft Form 1042-S for FATCA    
  (April 03, 2013)
  The IRS has published a draft Form 1042–S for 2014 that incorporates the information the IRS will be requesting for FATCA. Although the form does not include a full set of instructions,...
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• Signed Swiss IGA    
  (Feburary 14, 2013)
  Today the U.S. Treasury and the Swiss Federal Department of Finance ("FDF") announced that they have signed a FATCA intergovernmental agreement ("Swiss IGA"). The Swiss IGA...
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• IRS Comments at European Banking Federation ("EBF") FATCA Conference on Feb. 1, 2013    
  (Feburary 08, 2013)
  The IRS appeared by video link at the EBF’s FATCA Conference in Rome and engaged in an extensive Q&A session with...
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• Final FATCA Regulations Issued    
  (January 21, 2013)
  The U.S. Treasury and the IRS published the final FATCA regulations ("Regulations") on 1/17/13. While the Regulations contain many useful clarifications and modifications, the Regulations largely follow the rules laid out in the proposed regulations (good news considering the Regulations...
  Learn more.
• Final FATCA Regulations Released    
  (January 17, 2013)
  IRS published final regulations under FATCA. The regulations consist of 544 pages of explanatory preamble and operative rules. Numerous additional items still to come, such as the FFI agreement,...
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• United Kingdom Issues Draft FATCA Guidance   
  (January 03, 2013)
  The United Kingdom was the first country to sign a FATCA intergovernmental agreement ("IGA") with the United States, and it is now the first country to publish its interpretation of how the IGA should work. The draft regulations and 81 pages of draft guidance notes ...   
  Learn More.
• Ireland Signs IGA   
  (December 21, 2012)
  Today the government of Ireland announced that it had signed a FATCA intergovernmental agreement with the United States...   
  Learn More.
• Draft UK FATCA Regulations & Guidance Published by HMRC   
  (December 18, 2012)
  Today HMRC published draft regulations and guidance related to the United Kingdom’s intergovernmental agreement (“IGA”) with the United States...   
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• Updates from EEI International Withholding Tax Conference Held November 15-16   
  (November 26, 2012)
  The Executive Enterprise Institute’s 27th Annual Tax Withholding and Information Reporting Conference held recently in New York was an opportunity for...   
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• U.S. Government Releases Model 2 IGA   
  (November 19, 2012)
  Treasury has released Model 2 of the FATCA intergovernmental agreement (“IGA”). Treasury previously published reciprocal and non-reciprocal versions of Model 1; Model 2 completes the set...   
  Learn More.
• U.S. Treasury Identifies Likely IGA Countries   
  (November 9, 2012)
  The U.S. Treasury has announced the list of countries with which it is discussing Intergovernmental Agreements...   
  Learn More.
• Signed, Scanned and E-mailed or Faxed Forms W-8 Permitted With Safeguards, IRS Says   
  (November 2, 2012)
  The IRS Office of Chief Counsel has released a memorandum stating that Forms W-8 can be signed by hand, scanned, and e-mailed or faxed to withholding...   
  Learn More.
• IRS Announcement 2012-42 Postpones FATCA Dates, Clarifies Grandfathering   
  (October 25, 2012)
  The IRS announced on 24 October that most of the deadlines under FATCA have been postponed by six months. Announcement 2012-42...   
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• FATCA Dates Postponed Under Announcement 2012-42   
  (October 24, 2012)
  The IRS announced today that the new account provisions of FATCA will be delayed until January 1, 2014. Other dates have also been delayed...   
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• US–UK Intergovernmental Agreement   
  (September 18, 2012)
  On September 14, the United States and the United Kingdom announced that they had signed the first...   
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• United Kingdom signs FATCA IGA with U.S.   
  (September 14, 2012)
  Today the United States and the United Kingdom announced the signing of the first FATCA intergovernmental agreement. We have attached the document for...   
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• Draft Form W-8IMY Raises Many Questions; New Form W-8ECI Also Released   
  (August 16, 2012)
  The IRS has released draft versions of Forms W-8IMY and W-8ECI. Although the drafts are roughly what we expected...   
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• "Model 1" FATCA Intergovernmental Agreement ("IGA") May Show Direction of Final Regulations 
  (July 27, 2012)
  One of the basic problems with FATCA has been that it imposes obligations on foreign financial institutions ("FFIs") that may contravene...   
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• IRS Releases FATCA Joint Statements with Japan and Switzerland   
  (June 22, 2012)
  On June 21, 2012, the United States issued joint statements with Japan and Switzerland regarding a new intergovernmental agreement...   
  Learn More.
• Further Updates from EEI International Withholding Tax Conference Held June 5-6   
  (June 8, 2012)
  The Executive Enterprise Institute’s 24th Annual International Tax Withholding Conference held this past Tuesday and Wednesday in New York was an opportunity for the IRS to share the latest government developments regarding...   
  Learn More.
• IRS Provides Overview of Foreign Financial Institution (“FFI”) Agreement Administration Processes   
  (June 8, 2012)
  IRS representatives provided a long-awaited overview of FFI Agreement registration procedures during the Executive Enterprise Institute’s 24th Annual International Tax Withholding Conference held June 5-6. While...   
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• IRS Releases Draft Forms W–8BEN for the Foreign Account Tax Compliance Act (“FATCA”)   
  (June 7, 2012)
  The IRS yesterday released two unofficial drafts of forms to replace the current Form W–8BEN once FATCA goes into effect. Both forms would be used to certify that the recipient...   
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• IRS Hearing on U.S. Foreign Account Tax Compliance Act (“FATCA”) Reveals Major Themes   
  (May 16, 2012)
  The IRS hearing yesterday on the proposed FATCA regulations included 20 speakers over three-and-a-half hours. IRS and Treasury Department representatives asked no questions, so those hoping the government would tip its hand regarding the direction of the final regulations and foreign financial institution (“FFI”) Agreement went away disappointed...   
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• Final Regulations on U.S. Bank Deposit Interest (“USBDI”) Reporting Strengthens U.S. Foreign Account Tax Compliance Act (“FATCA”) Position   
  (May 7, 2012)
  The U.S. is hoping to turn FATCA into a multilateral tax reporting regime, and has already announced that five partner agreements are being negotiated; an additional country, Ireland, has also stated that it is negotiating with the U.S., and upwards of 40 other countries are rumored to be in talks...   
  Learn More.
• Cost Basis on Bonds and Options Delayed One Year   
  (May 3, 2012)
  Occasionally, even the IRS shows some mercy. Brokers have been phasing in cost basis reporting for stocks over the last year-and-a-half...   
  Learn More.
• Synopsis and Comments on the Proposed FATCA Regulations   
  (February 13, 2012)
  The U.S. Treasury and IRS published the proposed Chapter 4 FATCA regulations (“Regulations”) and the preamble (“Preamble”) to them on February 8, 2012 -- a daunting 388 pages of detailed rules...   
  Learn More.
• "FATCA Partnerships" – Are They the Cure for FATCA?   
  (February 10, 2012)
  The United States announced on February 8, 2012, that it is pursuing “FATCA Partnerships” with France, Germany, Italy, Spain, and the United Kingdom. The purpose of the agreements is to help “Foreign Financial Institutions” (“FFIs”) in these jurisdictions (“Partner FFIs”) to avoid local “legal impediments to compliance...  
  Learn More.
• Dividend Equivalent Payments Subject to U.S. Withholding   
  (January 24, 2012)
  The U.S. Treasury and IRS have taken the next step in their crackdown on transactions that avoid the U.S. withholding tax on U.S. source dividends. Recently issued temporary and proposed regulations define when a payment that references a U.S. source dividend...   
  Learn More.
• Faxed and Scanned Forms W-8 – Does New IRS Guidance Offer Hope?   
  (September 21, 2011)
  It is no secret to withholding agents that the IRS typically treats a customer or counterparty providing a faxed or scanned Form W-8 as “undocumented”...   
  Learn More.
• FATCA Transition Relief: Notice 2011-53   
  (July 15, 2011)
  The IRS has responded to industry and foreign government concerns regarding the January 1, 2013, effective date of the chapter 4 provisions of FATCA...   
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• Average Basis Creates “Revocation” and “Change” Issues  
  (June 28, 2011)
  The IRS is considering a change to the cost basis regulations that may require brokers to alter the way they handle customer requests to stop calculating basis by averaging.  The average basis rules do not...   
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• IRS Ruling On Consent Fees: Withholding and Information Reporting Consequences 
  (May 9, 2011)
  Until recently, there has been no guidance addressing the treatment of a consent fee paid to a debt holder to obtain the holder’s agreement to change the terms...   
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• Immediate Action Required for Participating FFIs with Respect to Responsible Officer Certifications
  (May 6, 2011)
  Although FATCA is not effective until January 1, 2013, foreign financial institutions (FFIs) that intend to enter into FFI Agreements with the IRS (“participating FFIs”)...   
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• IRS Releases Notice 2011-34 – Second FATCA Notice    
  (April 11, 2011)
  On April 8, 2011, Treasury and the IRS issued a second FATCA notice, Notice 2011-34 (the "Notice") supplementing Notice 2010-60 and providing new guidance in several...   
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• Electronic Form W-8 Validation Takes Off         
  (March 14, 2011)
  Electronic validation has grown exponentially in the past two years and is becoming the popular tool for US withholding agents and qualified intermediaries (“WAs”) to obtain Forms W-8 and W-9 quickly and efficiently from clients and vendors without spending...   
  Learn More.
• Final FBAR Regulations        
  (March 2, 2011)
  The U.S. Treasury has finalized regulations under the Bank Secrecy Act concerning the disclosure of foreign financial accounts by U.S. persons, commonly known as the foreign bank account reporting or “FBAR” regulations. These regulations require...   
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• New Form W-9       
  (February 9, 2011)
  The IRS released a new Form W-9 at the end of January. Financial institutions, accounts payable operations, and other payers of amounts that may be reported on Forms 1099 should start...   
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• IRS Requires Withholding and Reporting on Expense Reimbursements to Banks' Customers      
  (January 21, 2011)
  The IRS Office of Chief Counsel published a General Legal Advice Memorandum (“GLAM”) on December 17, 2010, concluding that expense reimbursements paid by U.S. depositary...   
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• The Reporting of U.S. Bank Deposit Interest: The Saga Continues     
  (January 12, 2011)
  The U.S. Treasury and the IRS published a proposed regulation on January 7, 2011, that would vastly expand the reporting of U.S. bank deposit interest (“BDI”) paid to non-U.S. individuals on Form 1042-S...  Learn More.
• 2010 Changes to RIC Distribution Rules     
  (January 6, 2011)
  Year-end legislative changes to the Regulated Investment Company (“RIC”) distribution rules provide significant benefits for both payors and RIC investors...   
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• Ian Unger    
  (December 30, 2010)
  BURT, STAPLES & MANER, LLP, is pleased to announce that Ian Unger will join the Firm as an associate effective January 3, 2011. Mr. Unger received...   
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• Final Cost Basis Regulations    
  (October 20, 2010)
  The final cost basis regulations have finally been published, a mere 11 weeks before the statutory effective date of January 1, 2011. Fortunately, the final rules follow the general outline of the proposed regulations published in December 2009, and...   
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• Increase in Information Return Penalties Starting Next Year   
  (September 29, 2010)
  Mistakes on information returns and payee statements just became a lot more expensive. Effective with returns required to be filed on or after January 1, 2011, the per-occurrence penalties for incorrect...   
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• IRS Comments on FATCA Notice 2010-60   
  (September 23, 2010)
  Several senior IRS executives addressed the Tax Executives Institute in New York City on September 22, 2010, as part of a panel chaired by John Staples, and commented on FATCA Notice 2010-60 (the “Notice”)...   
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• First Round of FATCA Guidance Published by IRS    
  (August 30, 2010)
  On Friday, August 27, the IRS published Notice 2010-60 (“Notice”), the first round of guidance under the Foreign Account Tax Compliance Act (“FATCA”) provisions...   
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• Notice 2010-46: New Securities Lending/Repo Rules: Notice 2010-46 Replaces Notice 97-66   
  (May 24, 2010)
  What is the purpose of Notice 2010-46? The Notice implements section 871(l)(6) of the Foreign Account Tax Compliance (“FATCA”) provisions of the HIRE...  
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• U.S. Withholding and Information Reporting on Dividend Equivalents Begins September 14, 2010  
  (April 16, 2010)
  ALERT: Clients should be aware that new section 871(l) enacted as part of FATCA requires withholding on dividend equivalents beginning on or after September 14, 2010. Prompt action is required. This alert describes dividend equivalents and...  
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• IRS Audits of U.S. Withholding Agents Intensifying     
  (April 6, 2010)
  We have seen a sharp increase in the number of IRS audits of U.S. withholding agents in the last few weeks. (cf. BSM client letter dated January 4, 2010.) Several weeks ago, we...  
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• Vendor Payment Reporting Significantly Expanded    
  (March 26, 2010)
  The Patient Protection and Affordable Care Act amends § 6041 (Form 1099-MISC reporting) in two ways: (1) it requires reporting of payments made to corporations, other than tax-exempt corporations, by treating them as non-exempt recipients; and...  
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• Container Corporation: New Rules or Old Concepts for Sourcing   
  (March 19, 2010)
  In Container Corporation v. Commissioner, 134 T.C. No. 5 (February 17, 2010), the Tax Court held that guarantee fees should be sourced by analogy to services...  
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• FATCA is Now Law  
  (March 18, 2010)
  Today, the President signed into law a major revamp of the U.S. withholding tax system that imposes a new 30% withholding tax on certain U.S. source payments made to foreign financial institutions (“FFIs”) and non-financial foreign entities (“NFFEs”) that refuse to identify certain U.S. persons invested with them offshore, even if... 
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• Do You Have a 2010 Strategy to Deal with Cost Basis Reporting and FATCA?  
  (February 8, 2010)
  Proposed regulations mandating cost basis reporting (“CBR”) and potential passage of the Foreign Account Tax Compliance Act (“FATCA”) constitute the biggest operational and systemic challenges that U.S. and non-U.S. financial institutions have had to face since... 
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• Likely Consequences to Financial Institutions from the IRS Voluntary Disclosure Program for U.S. Holders of Undisclosed Offshore Accounts  
  (January 28, 2010)
  Over 14,000 U.S. taxpayers trying to escape criminal prosecution have voluntarily disclosed their offshore accounts to the IRS in the last few months. More such... 
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• Appointment of Michael Danilack as IRS Deputy Commissioner (International) LMSB
  (January 20, 2010)
  I am pleased to announce that our partner, Mike Danilack, has been appointed Deputy Commissioner (International) for the Large and Midsize Business Unit (“LMSB”)...
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• New Years Update on IRS Withholding Tax Audits
  (January 4, 2010)
  The IRS has warned taxpayers for several years that it intends to conduct comprehensive checks of the compliance level of U.S. withholding agents...
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• U.S. Withholding Tax Legislation Introduced on October 27, 2009
  (October 30, 2009)
  Key Congressional tax writers introduced the “Foreign Account Tax Compliance Act of 2009” (“Act”) on October 27, 2009, with the U.S. Treasury expressing its support...
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• Meeting with IRS on July 30, 2009, to Discuss Changes to the QI System 
  (July 31, 2009)
  The IRS met with a limited number of representatives of the legal and accounting professions on July 30, 2009, to discuss pending legislative and regulatory changes affecting U.S. withholding taxes, particularly the Qualified Intermediary (“QI”) program. 
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• IRS Signals Preference for Interview-Style E-W8 Applications for Purposes of Securing MOU
  (June 18, 2009)
  The IRS recently announced its preference for a “Turbo Tax” interview-style electronic Form W-8 (“E-W8”) from Withholding Agents (“WA”) looking to secure a Memorandum of Understanding (“MOU”) for their E-W8 applications.
  Learn More.
• GlaxoSmithKline Case Shows Importance of Withholding Tax Issues
  (June 1, 2009)
  The IRS has made cross-border withholding taxes a Tier I issue and has said it will focus on these issues as never before. A recently published Tax Court petition filed by the U.S. group of GlaxoSmithKline shows how an IRS determination on the merits of a transaction...
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• Drastic Changes to Qualified Intermediary (“QI”) Program Proposed by Obama
  (May 7, 2009)
  The Obama Administration has proposed to Congress sweeping changes in the QI program and the way nonqualified intermediaries (“NQIs”) are treated.  If these proposals are adopted...
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• IRS Suggests Use of Internal Audit Departments to Control Costs of QI External Audits
  (May 1, 2009)
  The IRS recently proposed that a U.S. office of an accounting firm must participate in the external audit of a Qualified Intermediary (“QI”). The proposal set off an uproar in both the QI community...
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• IRS Ramps Up Withholding Tax Enforcement
  (April 3, 2009)
  We reported last December that the IRS elevated withholding tax and reporting issues to a “Tier 1” audit issue.  This means these issues generally are on par with tax shelters...
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• UBS Settlement with the IRS:  New Perils for Withholding Agents
  (February 20, 2009)
  UBS agreed to pay $780 million to the United States on February 18 to avoid criminal prosecution associated with its U.S. withholding tax compliance. While BSM’s representation of UBS in this case limits what we can say about the settlement...
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• New Withholding Tax Audit Developments
  (December 16, 2008)
  On a number of fronts it appears the IRS intends to raise again the stakes on withholding tax compliance. We would like to bring two specific matters to your attention...
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• U.S. Senate Focuses on Dividend Withholding Tax Abuse: Are Changes on the Way?
  (September 23, 2008)
  The U.S. Senate Permanent Subcommittee on Investigations (the "Subcommittee") held a hearing on September 11, 2008, entitled "Dividend Tax Abuse: How Offshore Entities Dodge Taxes on U.S. Stock Dividends."...
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• New Withholding Tax Audit Guidelines
  (August 15, 2008)
  The IRS published guidelines on August 7, 2008, for their examiners to follow when conducting withholding tax audits of U.S. withholding agents other than Qualified Intermediaries ("Guidelines")...
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• GAO report on Qualified Intermediary ("QI") Program and U.S. Withholding Agent ("USWA") Compliance
  (March 18, 2008)
  Eight years ago, the IRS allowed foreign institutions to hold securities on behalf of their clients and obtain a reduced withholding rate without disclosing their clients, provided the institution agreed to become a QI...
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• U.S. Income Tax Treaties with Belgium, Denmark, Finland & Germany
  (February 1, 2008)
  On January 2, 2008, the Treasury Department announced the entry into force of Protocols amending existing income tax treaties with Germany, Denmark and Finland and a new income tax treaty and protocol with Belgium...
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• Due Diligence Needed for All M&A
  (January 11, 2008)
  Recent experience shows that financial institutions (FIs) and multi-national corporations (MNCs) who acquire companies do not adequately review the tax withholding and information reporting activities of the acquiree as part of their due diligence...
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• Proposed NRA W/H Regs. on Redemptions of Actively Traded Stock
  (October 24, 2007)
  Recently, the Treasury and the IRS issued Proposed NRA Withholding Regulations on Redemptions of Actively Traded Stock.
  Learn More.
• The Electronic Form W-8: A Potential Cure for Your Compliance Headaches?
  (July 30, 2007)
  The Electronic Form W-8: A Potential Cure For Your Compliance Headaches?  CTI addresses some key issues to consider before implementing an E-W8 tool.
  Learn More.
• IRS Releases Draft W-8BEN and Instructions
  (July 9, 2007)
  The IRS has released a draft version of the 2008 Form W-8BEN, with instructions.
  Learn More.

Safe Harbor Data Privacy Statement

• Safe Harbor Data
  Compliance Technologies International, LLP (“CTI”) is committed to protecting the privacy and security of its clients, partners, and associates and therefore operates under a set of strict privacy principles.
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