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Japan 2011 Earthquake/Tsunami – U.S. Government Information


In the United States

Environmental Monitoring

The EPA has its radiation air monitoring (RadNet) data, frequently asked questions, and other resources on http://www.epa.gov/japan2011/. Here you can:

Food Safety

The U.S. Food and Drug Administration (FDA) has deemed that based on current information, there is no risk to the U.S. food supply.

In response to the ongoing situation in Japan, the EPA has taken steps to increase the level of nationwide monitoring of milk, precipitation, drinking water, and other potential exposure routes.

  • EPA conducts radiological monitoring of milk under its RADNET program
  • The U.S. Food and Drug Administration has jurisdiction over the safety, labeling and identity of milk and milk products in interstate commerce.
  • States have jurisdiction over those facilities located within their territory.

Results from a screening sample taken March 25 from Spokane, WA detected 0.8 pCi/L of iodine-131, which is more than 5,000 times lower than the Derived Intervention Level set by the U.S. Food and Drug Administration.

  • These types of findings are to be expected in the coming days and are far below levels of public health concern, including for infants and children.
  • Iodine-131 has a very short half-life of approximately eight days, and the level detected in milk and milk products is therefore expected to drop relatively quickly.

Radiation is all around us in our daily lives, and these findings are a miniscule amount compared to what people experience every day. For example, people are exposed to low levels of radiation on round trip cross country flights, watching television, and even from construction materials.

  • The U.S. Food and Drug Administration has jurisdiction over 80 percent of the food supply, including seafood, dairy, and produce. The U.S. Department of Agriculture regulates meat, poultry, and processed egg products, while FDA regulates all other food products.
  • The U.S. Department of Agriculture has stated that Japan has not exported any beef products to the United States for nearly a year.
  • The U.S. Department of Agriculture has stated that Japan is not currently eligible to export any poultry or processed egg products to the U.S.
  • The U.S. Food and Drug Administration and Customs and Border Protection carefully screen all food products for unsafe substances, including radiological material at Ports of Entry.
  • Learn more about keeping food safe during an emergency.

Potassium Iodide (KI)

The Centers for Disease Control (CDC) does not recommend that people in the United States take potassium iodide supplements (also called KI) in response to the damaged nuclear reactors in Japan.

  • Only take KI on the advice of emergency management officials, public health officials, or your doctor.
  • There are health risks associated with taking KI.

Food, Mail, Ships, and Cargo from Japan

The U.S. Customs and Border Protection (CBP) is monitoring developments in Japan carefully and uses several types of radiation detection equipment in air and sea ports, mail facilities, and elsewhere to ensure safety.

  • CBP and the U.S. Food and Drug Administration carefully screen all food products for unsafe substances, including radiological material, at Ports of Entry.
  • All inbound travelers, baggage, and cargo are screened for radiological materials.
  • CBP employs radiation monitors at international mail facilities.

American Citizens in Japan

American Embassy in Japan

All U.S. citizens in Japan should continue to carefully monitor the situation and follow the guidance of the U.S. and Japanese governments.

Authorized Departures

The U.S. government has authorized the voluntary departure from Japan of eligible family members of U.S. government personnel assigned to the U.S. Embassy in Tokyo, the U.S. Consulate in Nagoya, the Foreign Service Institute Field School in Yokohama, and U.S. Forces Japan.

Evacuations

Travel to and from Japan

Disaster Preparedness

The tragic events in Japan remind us that disasters can strike at any time. The best way to make sure your family is taken care of when disaster strikes is to be prepared.

Additional Information

  • Earthquake in Japan – See facts from the U.S. Geological Survey about the 9.0 earthquake.
  • Earthquake Preparedness and Response – The U.S. Centers for Disease Control and Prevention provides helpful tips on how to prepare for an earthquake and what to do during a quake.
  • Earthquakes, Flooding, and Radiation – The National Institutes of Health provides information and resources about natural disasters and their effects.
  • Tsunami Health Effects – The U.S. Centers for Disease Control and Prevention describes the immediate, secondary, and long-term health effects of a tsunami.
  • Tsunami Preparedness – The Federal Emergency Management Agency explains what a tsunami is and provides guidance on what to do during a tsunami watch or warning.
  • Radiation – Read about the assistance and expertise that the U.S. Department of Energy is providing to Japanese response and recovery efforts.

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State tax for free Publication 515 - Main Content Table of Contents Withholding of TaxWithholding Agent Withholding and Reporting Obligations Persons Subject to NRA WithholdingIdentifying the Payee Foreign Persons DocumentationBeneficial Owners Foreign Intermediaries and Foreign Flow-Through Entities Standards of Knowledge Presumption Rules Income Subject to NRA WithholdingSource of Income Fixed or Determinable Annual or Periodical Income (FDAP) Withholding on Specific IncomeEffectively Connected Income Income Not Effectively Connected Pay for Personal Services Performed Artists and Athletes (Income Codes 42 and 43) Other Income Foreign Governments and Certain Other Foreign Organizations U. State tax for free S. State tax for free Taxpayer Identification NumbersUnexpected payment. State tax for free Depositing Withheld TaxesWhen Deposits Are Required Adjustment for Overwithholding Returns RequiredJoint owners. State tax for free Electronic reporting. State tax for free Partnership Withholding on Effectively Connected IncomeWho Must Withhold Foreign Partner Publicly Traded Partnerships U. State tax for free S. State tax for free Real Property InterestForeign corporations. State tax for free Domestic corporations. State tax for free U. State tax for free S. State tax for free real property holding corporations. State tax for free Partnerships. State tax for free Trusts and estates. State tax for free Domestically controlled QIE. State tax for free Late filing of certifications or notices. State tax for free Certifications. State tax for free Liability of agent or qualified substitute. State tax for free Reporting and Paying the Tax Withholding Certificates Tax Treaty TablesTable 1 Table 2 Table 3 How To Get Tax HelpLow Income Taxpayer Clinics (LITCs). State tax for free Withholding of Tax In most cases, a foreign person is subject to U. State tax for free S. State tax for free tax on its U. State tax for free S. State tax for free source income. State tax for free Most types of U. State tax for free S. State tax for free source income received by a foreign person are subject to U. State tax for free S. State tax for free tax of 30%. State tax for free A reduced rate, including exemption, may apply if there is a tax treaty between the foreign person's country of residence and the United States. State tax for free The tax is generally withheld (NRA withholding) from the payment made to the foreign person. State tax for free The term “NRA withholding” is used in this publication descriptively to refer to withholding required under sections 1441, 1442, and 1443 of the Internal Revenue Code. State tax for free In most cases, NRA withholding describes the withholding regime that requires withholding on a payment of U. State tax for free S. State tax for free source income. State tax for free Payments to foreign persons, including nonresident alien individuals, foreign entities, and governments, may be subject to NRA withholding. State tax for free NRA withholding does not include withholding under section 1445 of the Code (see U. State tax for free S. State tax for free Real Property Interest, later) or under section 1446 of the Code (see Partnership Withholding on Effectively Connected Income , later). State tax for free A withholding agent (defined next) is the person responsible for withholding on payments made to a foreign person. State tax for free However, a withholding agent that can reliably associate the payment with documentation (discussed later) from a U. State tax for free S. State tax for free person is not required to withhold. State tax for free In addition, a withholding agent may apply a reduced rate of withholding (including an exemption from withholding) if it can reliably associate the payment with documentation from a beneficial owner that is a foreign person entitled to a reduced rate of withholding. State tax for free Withholding Agent You are a withholding agent if you are a U. State tax for free S. State tax for free or foreign person that has control, receipt, custody, disposal, or payment of any item of income of a foreign person that is subject to withholding. State tax for free A withholding agent may be an individual, corporation, partnership, trust, association, nominee (under section 1446 of the Code), or any other entity, including any foreign intermediary, foreign partnership, or U. State tax for free S. State tax for free branch of certain foreign banks and insurance companies. State tax for free You may be a withholding agent even if there is no requirement to withhold from a payment or even if another person has withheld the required amount from the payment. State tax for free Although several persons may be withholding agents for a single payment, the full tax is required to be withheld only once. State tax for free In most cases, the U. State tax for free S. State tax for free person who pays an amount subject to NRA withholding is the person responsible for withholding. State tax for free However, other persons may be required to withhold. State tax for free For example, a payment made by a flow-through entity or nonqualified intermediary that knows, or has reason to know, that the full amount of NRA withholding was not done by the person from which it receives a payment is required to do the appropriate withholding since it also falls within the definition of a withholding agent. State tax for free In addition, withholding must be done by any qualified intermediary, withholding foreign partnership, or withholding foreign trust in accordance with the terms of its withholding agreement, discussed later. State tax for free Liability for tax. State tax for free   As a withholding agent, you are personally liable for any tax required to be withheld. State tax for free This liability is independent of the tax liability of the foreign person to whom the payment is made. State tax for free If you fail to withhold and the foreign payee fails to satisfy its U. State tax for free S. State tax for free tax liability, then both you and the foreign person are liable for tax, as well as interest and any applicable penalties. State tax for free   The applicable tax will be collected only once. State tax for free If the foreign person satisfies its U. State tax for free S. State tax for free tax liability, you are not liable for the tax but remain liable for any interest and penalties for failure to withhold. State tax for free Determination of amount to withhold. State tax for free   You must withhold on the gross amount subject to NRA withholding. State tax for free You cannot reduce the gross amount by any deductions. State tax for free However, see Scholarships and Fellowship Grants and Pay for Personal Services Performed , later, for when a deduction for a personal exemption may be allowed. State tax for free   If the determination of the source of the income or the amount subject to tax depends on facts that are not known at the time of payment, you must withhold an amount sufficient to ensure that at least 30% of the amount subsequently determined to be subject to withholding is withheld. State tax for free In no case, however, should you withhold more than 30% of the total amount paid. State tax for free Or, you may make a reasonable estimate of the amount from U. State tax for free S. State tax for free sources and put a corresponding part of the amount due in escrow until the amount from U. State tax for free S. State tax for free sources can be determined, at which time withholding becomes due. State tax for free When to withhold. State tax for free   Withholding is required at the time you make a payment of an amount subject to withholding. State tax for free A payment is made to a person if that person realizes income, whether or not there is an actual transfer of cash or other property. State tax for free A payment is considered made to a person if it is paid for that person's benefit. State tax for free For example, a payment made to a creditor of a person in satisfaction of that person's debt to the creditor is considered made to the person. State tax for free A payment also is considered made to a person if it is made to that person's agent. State tax for free   A U. State tax for free S. State tax for free partnership should withhold when any distributions that include amounts subject to withholding are made. State tax for free However, if a foreign partner's distributive share of income subject to withholding is not actually distributed, the U. State tax for free S. State tax for free partnership must withhold on the foreign partner's distributive share of the income on the earlier of the date that a Schedule K-1 (Form 1065) is provided or mailed to the partner or the due date for furnishing that schedule. State tax for free If the distributable amount consists of effectively connected income, see Partnership Withholding on Effectively Connected Income , later. State tax for free A U. State tax for free S. State tax for free trust is required to withhold on the amount includible in the gross income of a foreign beneficiary to the extent the trust's distributable net income consists of an amount subject to withholding. State tax for free To the extent a U. State tax for free S. State tax for free trust is required to distribute an amount subject to withholding but does not actually distribute the amount, it must withhold on the foreign beneficiary's allocable share at the time the income is required to be reported on Form 1042-S. State tax for free Withholding and Reporting Obligations You are required to report payments subject to NRA withholding on Form 1042-S and to file a tax return on Form 1042. State tax for free (See Returns Required , later. State tax for free ) An exception from reporting may apply to individuals who are not required to withhold from a payment and who do not make the payment in the course of their trade or business. State tax for free Form 1099 reporting and backup withholding. State tax for free    You also may be responsible as a payer for reporting on Form 1099 payments made to a U. State tax for free S. State tax for free person. State tax for free You must withhold 28% (backup withholding rate) from a reportable payment made to a U. State tax for free S. State tax for free person that is subject to Form 1099 reporting if any of the following apply. State tax for free The U. State tax for free S. State tax for free person has not provided its taxpayer identification number (TIN) in the manner required. State tax for free The IRS notifies you that the TIN furnished by the payee is incorrect. State tax for free There has been a notified payee underreporting. State tax for free There has been a payee certification failure. State tax for free In most cases, a TIN must be provided by a U. State tax for free S. State tax for free non-exempt recipient on Form W-9, Request for Taxpayer Identification Number and Certification. State tax for free A payer files a tax return on Form 945, Annual Return of Withheld Federal Income Tax, for backup withholding. State tax for free You may be required to file Form 1099 and, if appropriate, backup withhold, even if you do not make the payments directly to that U. State tax for free S. State tax for free person. State tax for free For example, you are required to report income paid to a foreign intermediary or flow-through entity that collects for a U. State tax for free S. State tax for free person subject to Form 1099 reporting. State tax for free See Identifying the Payee , later, for more information. State tax for free Also see Section S. State tax for free Special Rules for Reporting Payments Made Through Foreign Intermediaries and Foreign Flow-Through Entities on Form 1099 in the General Instructions for Certain Information Returns. State tax for free Foreign persons who provide Form W-8BEN, Form W-8ECI, or Form W-8EXP (or applicable documentary evidence) are exempt from backup withholding and Form 1099 reporting. State tax for free Wages paid to employees. State tax for free   If you are the employer of a nonresident alien, you generally must withhold taxes at graduated rates. State tax for free See Pay for Personal Services Performed , later. State tax for free Effectively connected income by partnerships. State tax for free   A withholding agent that is a partnership (whether U. State tax for free S. State tax for free or foreign) is also responsible for withholding on its income effectively connected with a U. State tax for free S. State tax for free trade or business that is allocable to foreign partners. State tax for free See Partnership Withholding on Effectively Connected Income , later, for more information. State tax for free U. State tax for free S. State tax for free real property interest. State tax for free   A withholding agent also may be responsible for withholding if a foreign person transfers a U. State tax for free S. State tax for free real property interest to the agent, or if it is a corporation, partnership, trust, or estate that distributes a U. State tax for free S. State tax for free real property interest to a shareholder, partner, or beneficiary that is a foreign person. State tax for free See U. State tax for free S. State tax for free Real Property Interest , later. State tax for free Persons Subject to NRA Withholding NRA withholding applies only to payments made to a payee that is a foreign person. State tax for free It does not apply to payments made to U. State tax for free S. State tax for free persons. State tax for free Usually, you determine the payee's status as a U. State tax for free S. State tax for free or foreign person based on the documentation that person provides. State tax for free See Documentation , later. State tax for free However, if you have received no documentation or you cannot reliably associate all or a part of a payment with documentation, then you must apply certain presumption rules, discussed later. State tax for free Identifying the Payee In most cases, the payee is the person to whom you make the payment, regardless of whether that person is the beneficial owner of the income. State tax for free However, there are situations in which the payee is a person other than the one to whom you actually make a payment. State tax for free U. State tax for free S. State tax for free agent of foreign person. State tax for free   If you make a payment to a U. State tax for free S. State tax for free person and you have actual knowledge that the U. State tax for free S. State tax for free person is receiving the payment as an agent of a foreign person, you must treat the payment as made to the foreign person. State tax for free However, if the U. State tax for free S. State tax for free person is a financial institution, you may treat the institution as the payee provided you have no reason to believe that the institution will not comply with its own obligation to withhold. State tax for free   If the payment is not subject to NRA withholding (for example, gross proceeds from the sales of securities), you must treat the payment as made to a U. State tax for free S. State tax for free person and not as a payment to a foreign person. State tax for free You may be required to report the payment on Form 1099 and, if applicable, backup withhold. State tax for free Disregarded entities. State tax for free   A business entity that is not a corporation and that has a single owner may be disregarded as an entity separate from its owner (a disregarded entity) for federal tax purposes. State tax for free The payee of a payment made to a disregarded entity is the owner of the entity. State tax for free   If the owner of the entity is a foreign person, you must apply NRA withholding unless you can treat the foreign owner as a beneficial owner entitled to a reduced rate of withholding. State tax for free   If the owner is a U. State tax for free S. State tax for free person, you do not apply NRA withholding. State tax for free However, you may be required to report the payment on Form 1099 and, if applicable, backup withhold. State tax for free You may assume that a foreign entity is not a disregarded entity unless you can reliably associate the payment with documentation provided by the owner or you have actual knowledge or reason to know that the foreign entity is a disregarded entity. State tax for free Flow-Through Entities The payees of payments (other than income effectively connected with a U. State tax for free S. State tax for free trade or business) made to a foreign flow-through entity are the owners or beneficiaries of the flow-through entity. State tax for free This rule applies for purposes of NRA withholding and for Form 1099 reporting and backup withholding. State tax for free Income that is, or is deemed to be, effectively connected with the conduct of a U. State tax for free S. State tax for free trade or business of a flow-through entity is treated as paid to the entity. State tax for free All of the following are flow-through entities. State tax for free A foreign partnership (other than a withholding foreign partnership). State tax for free A foreign simple or foreign grantor trust (other than a withholding foreign trust). State tax for free A fiscally transparent entity receiving income for which treaty benefits are claimed. State tax for free See Fiscally transparent entity , later. State tax for free In most cases, you treat a payee as a flow-through entity if it provides you with a Form W-8IMY (see Documentation , later) on which it claims such status. State tax for free You also may be required to treat the entity as a flow-through entity under the presumption rules, discussed later. State tax for free You must determine whether the owners or beneficiaries of a flow-through entity are U. State tax for free S. State tax for free or foreign persons, how much of the payment relates to each owner or beneficiary, and, if the owner or beneficiary is foreign, whether a reduced rate of NRA withholding applies. State tax for free You make these determinations based on the documentation and other information (contained in a withholding statement) that is associated with the flow-through entity's Form W-8IMY. State tax for free If you do not have all of the information that is required to reliably associate a payment with a specific payee, you must apply the presumption rules. State tax for free See Documentation and Presumption Rules , later. State tax for free Withholding foreign partnerships and withholding foreign trusts are not flow-through entities. State tax for free Foreign partnerships. State tax for free    A foreign partnership is any partnership that is not organized under the laws of any state of the United States or the District of Columbia or any partnership that is treated as foreign under the income tax regulations. State tax for free If a foreign partnership is not a withholding foreign partnership, the payees of income are the partners of the partnership, provided the partners are not themselves a flow-through entity or a foreign intermediary. State tax for free However, the payee is the partnership itself if the partnership is claiming treaty benefits on the basis that it is not fiscally transparent and that it meets all the other requirements for claiming treaty benefits. State tax for free If a partner is a foreign flow-through entity or a foreign intermediary, you apply the payee determination rules to that partner to determine the payees. State tax for free Example 1. State tax for free A nonwithholding foreign partnership has three partners: a nonresident alien individual; a foreign corporation; and a U. State tax for free S. State tax for free citizen. State tax for free You make a payment of U. State tax for free S. State tax for free source interest to the partnership. State tax for free It gives you a Form W-8IMY with which it associates Form W-8BEN from the nonresident alien; Form W-8BEN from the foreign corporation; and Form W-9 from the U. State tax for free S. State tax for free citizen. State tax for free The partnership also gives you a complete withholding statement that enables you to associate a part of the interest payment to each partner. State tax for free You must treat all three partners as the payees of the interest payment as if the payment were made directly to them. State tax for free Report the payment to the nonresident alien and the foreign corporation on Forms 1042-S. State tax for free Report the payment to the U. State tax for free S. State tax for free citizen on Form 1099-INT. State tax for free Example 2. State tax for free A nonwithholding foreign partnership has two partners: a foreign corporation and a nonwithholding foreign partnership. State tax for free The second partnership has two partners, both nonresident alien individuals. State tax for free You make a payment of U. State tax for free S. State tax for free source interest to the first partnership. State tax for free It gives you a valid Form W-8IMY with which it associates a Form W-8BEN from the foreign corporation and a Form W-8IMY from the second partnership. State tax for free In addition, Forms W-8BEN from the partners are associated with the Form W-8IMY from the second partnership. State tax for free The Forms W-8IMY from the partnerships have complete withholding statements associated with them. State tax for free Because you can reliably associate a part of the interest payment with the Form W-8BEN provided by the foreign corporation and the Forms W-8BEN provided by the nonresident alien individual partners as a result of the withholding statements, you must treat them as the payees of the interest. State tax for free Example 3. State tax for free You make a payment of U. State tax for free S. State tax for free source dividends to a withholding foreign partnership. State tax for free The partnership has two partners, both foreign corporations. State tax for free You can reliably associate the payment with a valid Form W-8IMY from the partnership on which it represents that it is a withholding foreign partnership. State tax for free You must treat the partnership as the payee of the dividends. State tax for free Foreign simple and grantor trust. State tax for free   A trust is foreign unless it meets both of the following tests. State tax for free A court within the United States is able to exercise primary supervision over the administration of the trust. State tax for free One or more U. State tax for free S. State tax for free persons have the authority to control all substantial decisions of the trust. State tax for free   In most cases, a foreign simple trust is a foreign trust that is required to distribute all of its income annually. State tax for free A foreign grantor trust is a foreign trust that is treated as a grantor trust under sections 671 through 679 of the Code. State tax for free   The payees of a payment made to a foreign simple trust are the beneficiaries of the trust. State tax for free The payees of a payment made to a foreign grantor trust are the owners of the trust. State tax for free However, the payee is the foreign simple or grantor trust itself if the trust is claiming treaty benefits on the basis that it is not fiscally transparent and that it meets all the other requirements for claiming treaty benefits. State tax for free If the beneficiaries or owners are themselves flow-through entities or foreign intermediaries, you apply the payee determination rules to that beneficiary or owner to determine the payees. State tax for free Example. State tax for free A foreign simple trust has three beneficiaries: two nonresident alien individuals and a U. State tax for free S. State tax for free citizen. State tax for free You make a payment of interest to the foreign trust. State tax for free It gives you a Form W-8IMY with which it associates Forms W-8BEN from the nonresident aliens and a Form W-9 from the U. State tax for free S. State tax for free citizen. State tax for free The trust also gives you a complete withholding statement that enables you to associate a part of the interest payment with the forms provided by each beneficiary. State tax for free You must treat all three beneficiaries as the payees of the interest payment as if the payment were made directly to them. State tax for free Report the payment to the nonresident aliens on Forms 1042-S. State tax for free Report the payment to the U. State tax for free S. State tax for free citizen on Form 1099-INT. State tax for free Fiscally transparent entity. State tax for free   If a reduced rate of withholding under an income tax treaty is claimed, a flow-through entity includes any entity in which the interest holder must treat the entity as fiscally transparent. State tax for free The determination of whether an entity is fiscally transparent is made on an item of income basis (that is, the determination is made separately for interest, dividends, royalties, etc. State tax for free ). State tax for free The interest holder in an entity makes the determination by applying the laws of the jurisdiction where the interest holder is organized, incorporated, or otherwise considered a resident. State tax for free An entity is considered to be fiscally transparent for the income to the extent the laws of that jurisdiction require the interest holder to separately take into account on a current basis the interest holder's share of the income, whether or not distributed to the interest holder, and the character and source of the income to the interest holder are determined as if the income was realized directly from the source that paid it to the entity. State tax for free Subject to the standards of knowledge rules discussed later, you generally make the determination that an entity is fiscally transparent based on a Form W-8IMY provided by the entity. State tax for free   The payees of a payment made to a fiscally transparent entity are the interest holders of the entity. State tax for free Example. State tax for free Entity A is a business organization organized under the laws of country X that has an income tax treaty in force with the United States. State tax for free A has two interest holders, B and C. State tax for free B is a corporation organized under the laws of country Y. State tax for free C is a corporation organized under the laws of country Z. State tax for free Both countries Y and Z have an income tax treaty in force with the United States. State tax for free A receives royalty income from U. State tax for free S. State tax for free sources that is not effectively connected with the conduct of a trade or business in the United States. State tax for free For U. State tax for free S. State tax for free income tax purposes, A is treated as a partnership. State tax for free Country X treats A as a partnership and requires the interest holders in A to separately take into account on a current basis their respective shares of the income paid to A even if the income is not distributed. State tax for free The laws of country X provide that the character and source of the income to A's interest holders are determined as if the income was realized directly from the source that paid it to A. State tax for free Accordingly, A is fiscally transparent in its jurisdiction, country X. State tax for free B and C are not fiscally transparent under the laws of their respective countries of incorporation. State tax for free Country Y requires B to separately take into account on a current basis B's share of the income paid to A, and the character and source of the income to B is determined as if the income was realized directly from the source that paid it to A. State tax for free Accordingly, A is fiscally transparent for that income under the laws of country Y, and B is treated as deriving its share of the U. State tax for free S. State tax for free source royalty income for purposes of the U. State tax for free S. State tax for free -Y income tax treaty. State tax for free Country Z, on the other hand, treats A as a corporation and does not require C to take into account its share of A's income on a current basis whether or not distributed. State tax for free Therefore, A is not treated as fiscally transparent under the laws of country Z. State tax for free Accordingly, C is not treated as deriving its share of the U. State tax for free S. State tax for free source royalty income for purposes of the U. State tax for free S. State tax for free -Z income tax treaty. State tax for free Foreign Intermediaries In most cases, if you make payments to a foreign intermediary, the payees are the persons for whom the foreign intermediary collects the payment, such as account holders or customers, not the intermediary itself. State tax for free This rule applies for purposes of NRA withholding and for Form 1099 reporting and backup withholding. State tax for free You may, however, treat a qualified intermediary that has assumed primary withholding responsibility for a payment as the payee, and you are not required to withhold. State tax for free An intermediary is a custodian, broker, nominee, or any other person that acts as an agent for another person. State tax for free A foreign intermediary is either a qualified intermediary or a nonqualified intermediary. State tax for free In most cases, you determine whether an entity is a qualified intermediary or a nonqualified intermediary based on the representations the intermediary makes on Form W-8IMY. State tax for free You must determine whether the customers or account holders of a foreign intermediary are U. State tax for free S. State tax for free or foreign persons and, if the account holder or customer is foreign, whether a reduced rate of NRA withholding applies. State tax for free You make these determinations based on the foreign intermediary's Form W-8IMY and associated information and documentation. State tax for free If you do not have all of the information or documentation that is required to reliably associate a payment with a payee, you must apply the presumption rules. State tax for free See Documentation and Presumption Rules , later. State tax for free Nonqualified intermediary. State tax for free   A nonqualified intermediary (NQI) is any intermediary that is a foreign person and that is not a qualified intermediary. State tax for free The payees of a payment made to an NQI are the customers or account holders on whose behalf the NQI is acting. State tax for free Example. State tax for free You make a payment of interest to a foreign bank that is a nonqualified intermediary. State tax for free The bank gives you a Form W-8IMY and the Forms W-8BEN of two foreign persons, and a Form W-9 from a U. State tax for free S. State tax for free person for whom the bank is collecting the payments. State tax for free The bank also associates with its Form W-8IMY a withholding statement on which it allocates the interest payment to each account holder and provides all other information required to be on the withholding statement. State tax for free The account holders are the payees of the interest payment. State tax for free You should report the part of the interest paid to the two foreign persons on Forms 1042-S and the part paid to the U. State tax for free S. State tax for free person on Form 1099-INT. State tax for free Qualified intermediary. State tax for free   A qualified intermediary (QI) is any foreign intermediary (or foreign branch of a U. State tax for free S. State tax for free intermediary) that has entered into a qualified intermediary withholding agreement (discussed later) with the IRS. State tax for free You may treat a QI as a payee to the extent the QI assumes primary withholding responsibility or primary Form 1099 reporting and backup withholding responsibility for a payment. State tax for free In this situation, the QI is required to withhold the tax. State tax for free You can determine whether a QI has assumed responsibility from the Form W-8IMY provided by the QI. State tax for free   A payment to a QI to the extent it does not assume primary NRA withholding responsibility is considered made to the person on whose behalf the QI acts. State tax for free If a QI does not assume Form 1099 reporting and backup withholding responsibility, you must report on Form 1099 and, if applicable, backup withhold as if you were making the payment directly to the U. State tax for free S. State tax for free person. State tax for free Branches of financial institutions. State tax for free   Branches of financial institutions are not permitted to operate as QIs if they are located outside of countries having approved “know-your-customer” (KYC) rules. State tax for free The countries with approved KYC rules are listed on IRS. State tax for free gov. State tax for free QI withholding agreement. State tax for free   Foreign financial institutions and foreign branches of U. State tax for free S. State tax for free financial institutions can enter into an agreement with the IRS to be a qualified intermediary. State tax for free   A QI is entitled to certain simplified withholding and reporting rules. State tax for free In general, there are three major areas whereby intermediaries with QI status are afforded such simplified treatment. State tax for free   To apply for QI status, complete Form 14345, Qualified Intermediary Application, and Form SS-4, Application for Employer Identification Number. State tax for free These forms, and the procedures required to obtain a QI withholding agreement are available at www. State tax for free irs. State tax for free gov/Businesses/Corporations/Qualified-Intermediaries-(QI). State tax for free Documentation. State tax for free   A QI is not required to forward documentation obtained from foreign account holders to the U. State tax for free S. State tax for free withholding agent from whom the QI receives a payment of U. State tax for free S. State tax for free source income. State tax for free The QI maintains such documentation at its location and provides the U. State tax for free S. State tax for free withholding agent with withholding rate pools. State tax for free A withholding rate pool is a payment of a single type of income that is subject to a single rate of withholding. State tax for free   A QI is required to provide the U. State tax for free S. State tax for free withholding agent with information regarding U. State tax for free S. State tax for free persons subject to Form 1099 information reporting unless the QI assumes the primary obligation to do Form 1099 reporting and backup withholding. State tax for free   If a QI obtains documentary evidence under the “know-your-customer” rules that apply to the QI under local law, and the documentary evidence is of a type specified in an attachment to the QI agreement, the documentary evidence remains valid until there is a change in circumstances or the QI knows the information is incorrect. State tax for free This indefinite validity period rule does not apply to Forms W-8 or to documentary evidence that is not of the type specified in the attachment to the agreement. State tax for free Form 1042-S reporting. State tax for free   A QI is permitted to report payments made to its direct foreign account holders on a pooled basis rather than reporting payments to each direct account holder specifically. State tax for free Pooled basis reporting is not available for payments to certain account holders, such as a nonqualified intermediary or a flow-through entity (discussed earlier). State tax for free Collective refund procedures. State tax for free   A QI may seek a refund on behalf of its direct account holders. State tax for free The direct account holders, therefore, are not required to file returns with the IRS to obtain refunds, but rather may obtain them from the QI. State tax for free U. State tax for free S. State tax for free branches of foreign banks and foreign insurance companies. State tax for free   Special rules apply to a U. State tax for free S. State tax for free branch of a foreign bank subject to Federal Reserve Board supervision or a foreign insurance company subject to state regulatory supervision. State tax for free If you agree to treat the branch as a U. State tax for free S. State tax for free person, you may treat the branch as a U. State tax for free S. State tax for free payee for a payment subject to NRA withholding provided you receive a Form W-8IMY from the U. State tax for free S. State tax for free branch on which the agreement is evidenced. State tax for free If you treat the branch as a U. State tax for free S. State tax for free payee, you are not required to withhold. State tax for free Even though you agree to treat the branch as a U. State tax for free S. State tax for free person, you must report the payment on Form 1042-S. State tax for free   A financial institution organized in a U. State tax for free S. State tax for free possession is treated as a U. State tax for free S. State tax for free branch. State tax for free The special rules discussed in this section apply to a possessions financial institution. State tax for free   If you are paying a U. State tax for free S. State tax for free branch an amount that is not subject to NRA withholding, treat the payment as made to a foreign person, irrespective of any agreement to treat the branch as a U. State tax for free S. State tax for free person for amounts subject to NRA withholding. State tax for free Consequently, amounts not subject to NRA withholding that are paid to a U. State tax for free S. State tax for free branch are not subject to Form 1099 reporting or backup withholding. State tax for free   Alternatively, a U. State tax for free S. State tax for free branch may provide you with a Form W-8IMY with which it associates the documentation of the persons on whose behalf it acts. State tax for free In this situation, the payees are the persons on whose behalf the branch acts provided you can reliably associate the payment with valid documentation from those persons. State tax for free See Nonqualified Intermediaries under  Documentation, later. State tax for free   If the U. State tax for free S. State tax for free branch does not provide you with a Form W-8IMY, then you should treat a payment subject to NRA withholding as made to the foreign person of which the branch is a part and the income as effectively connected with the conduct of a trade or business in the United States. State tax for free Withholding foreign partnership and foreign trust. State tax for free   A withholding foreign partnership (WP) is any foreign partnership that has entered into a WP withholding agreement with the IRS and is acting in that capacity. State tax for free A withholding foreign trust (WT) is a foreign simple or grantor trust that has entered into a WT withholding agreement with the IRS and is acting in that capacity. State tax for free   A WP or WT may act in that capacity only for payments of amounts subject to NRA withholding that are distributed to, or included in the distributive share of, its direct partners, beneficiaries, or owners. State tax for free A WP or WT acting in that capacity must assume NRA withholding responsibility for these amounts. State tax for free You may treat a WP or WT as a payee if it has provided you with documentation (discussed later) that represents that it is acting as a WP or WT for such amounts. State tax for free WP and WT withholding agreements. State tax for free   The WP and WT withholding agreements and the application procedures for the agreements are in Revenue Procedure 2003-64. State tax for free Also see the following items. State tax for free Revenue Procedure 2004-21. State tax for free Revenue Procedure 2005-77. State tax for free Employer identification number (EIN). State tax for free   A completed Form SS-4 must be submitted with the application for being a WP or WT. State tax for free The WP or WT will be assigned a WP-EIN or WT-EIN to be used only when acting in that capacity. State tax for free Documentation. State tax for free   A WP or WT must provide you with a Form W-8IMY that certifies that the WP or WT is acting in that capacity and a written statement identifying the amounts for which it is so acting. State tax for free The statement is not required to contain withholding rate pool information or any information relating to the identity of a direct partner, beneficiary, or owner. State tax for free The Form W-8IMY must contain the WP-EIN or WT-EIN. State tax for free Foreign Persons A payee is subject to NRA withholding only if it is a foreign person. State tax for free A foreign person includes a nonresident alien individual, foreign corporation, foreign partnership, foreign trust, foreign estate, and any other person that is not a U. State tax for free S. State tax for free person. State tax for free It also includes a foreign branch of a U. State tax for free S. State tax for free financial institution if the foreign branch is a qualified intermediary. State tax for free In most cases, the U. State tax for free S. State tax for free branch of a foreign corporation or partnership is treated as a foreign person. State tax for free Nonresident alien. State tax for free   A nonresident alien is an individual who is not a U. State tax for free S. State tax for free citizen or a resident alien. State tax for free A resident of a foreign country under the residence article of an income tax treaty is a nonresident alien individual for purposes of withholding. State tax for free Married to U. State tax for free S. State tax for free citizen or resident alien. State tax for free   Nonresident alien individuals married to U. State tax for free S. State tax for free citizens or resident aliens may choose to be treated as resident aliens for certain income tax purposes. State tax for free However, these individuals are still subject to the NRA withholding rules that apply to nonresident aliens for all income except wages. State tax for free Wages paid to these individuals are subject to graduated withholding. State tax for free See Wages Paid to Employees—Graduated Withholding . State tax for free Resident alien. State tax for free   A resident alien is an individual who is not a citizen or national of the United States and who meets either the green card test or the substantial presence test for the calendar year. State tax for free Green card test. State tax for free An alien is a resident alien if the individual was a lawful permanent resident of the United States at any time during the calendar year. State tax for free This is known as the green card test because these aliens hold immigrant visas (also known as green cards). State tax for free Substantial presence test. State tax for free An alien is considered a resident alien if the individual meets the substantial presence test for the calendar year. State tax for free Under this test, the individual must be physically present in the United States on at least: 31 days during the current calendar year, and 183 days during the current year and the 2 preceding years, counting all the days of physical presence in the current year, but only 1/3 the number of days of presence in the first preceding year, and only 1/6 the number of days in the second preceding year. State tax for free   In most cases, the days the alien is in the United States as a teacher, student, or trainee on an “F,” “J,” “M,” or “Q” visa are not counted. State tax for free This exception is for a limited period of time. State tax for free   For more information on resident and nonresident status, the tests for residence, and the exceptions to them, see Publication 519. State tax for free Note. State tax for free   If your employee is late in notifying you that his or her status changed from nonresident alien to resident alien, you may have to make an adjustment to Form 941 if that employee was exempt from withholding of social security and Medicare taxes as a nonresident alien. State tax for free For more information on making adjustments, see chapter 13 of Publication 15 (Circular E). State tax for free Resident of a U. State tax for free S. State tax for free possession. State tax for free   A bona fide resident of Puerto Rico, the U. State tax for free S. State tax for free Virgin Islands, Guam, the Commonwealth of the Northern Mariana Islands (CNMI), or American Samoa who is not a U. State tax for free S. State tax for free citizen or a U. State tax for free S. State tax for free national is treated as a nonresident alien for the withholding rules explained here. State tax for free A bona fide resident of a possession is someone who: Meets the presence test, Does not have a tax home outside the possession, and Does not have a closer connection to the United States or to a foreign country than to the possession. State tax for free   For more information, see Publication 570, Tax Guide for Individuals With Income From U. State tax for free S. State tax for free Possessions. State tax for free Foreign corporations. State tax for free   A foreign corporation is one that does not fit the definition of a domestic corporation. State tax for free A domestic corporation is one that was created or organized in the United States or under the laws of the United States, any of its states, or the District of Columbia. State tax for free Guam or Northern Mariana Islands corporations. State tax for free   A corporation created or organized in, or under the laws of, Guam or the CNMI is not considered a foreign corporation for the purpose of withholding tax for the tax year if: At all times during the tax year less than 25% in value of the corporation's stock is owned, directly or indirectly, by foreign persons; and At least 20% of the corporation's gross income is derived from sources within Guam or the CNMI for the 3-year period ending with the close of the preceding tax year of the corporation (or the period the corporation has been in existence, if less). State tax for free Note. State tax for free   The provisions discussed below under U. State tax for free S. State tax for free Virgin Islands and American Samoa corporations will apply to Guam or CNMI corporations when an implementing agreement is in effect between the United States and that possession. State tax for free U. State tax for free S. State tax for free Virgin Islands and American Samoa corporations. State tax for free   A corporation created or organized in, or under the laws of, the U. State tax for free S. State tax for free Virgin Islands or American Samoa is not considered a foreign corporation for the purposes of withholding tax for the tax year if: At all times during the tax year less than 25% in value of the corporation's stock is owned, directly or indirectly, by foreign persons, At least 65% of the corporation's gross income is effectively connected with the conduct of a trade or business in the U. State tax for free S. State tax for free Virgin Islands, American Samoa, Guam, the CNMI, or the United States for the 3-year period ending with the close of the tax year of the corporation (or the period the corporation or any predecessor has been in existence, if less), and No substantial part of the income of the corporation is used, directly or indirectly, to satisfy obligations to a person who is not a bona fide resident of the U. State tax for free S. State tax for free Virgin Islands, American Samoa, Guam, the CNMI, or the United States. State tax for free Foreign private foundations. State tax for free   A private foundation that was created or organized under the laws of a foreign country is a foreign private foundation. State tax for free Gross investment income from sources within the United States paid to a qualified foreign private foundation is subject to NRA withholding at a 4% rate (unless exempted by a treaty) rather than the ordinary statutory 30% rate. State tax for free Other foreign organizations, associations, and charitable institutions. State tax for free   An organization may be exempt from income tax under section 501(a) of the Internal Revenue Code even if it was formed under foreign law. State tax for free In most cases, you do not have to withhold tax on payments of income to these foreign tax-exempt organizations unless the IRS has determined that they are foreign private foundations. State tax for free   Payments to these organizations, however, must be reported on Form 1042-S, even though no tax is withheld. State tax for free   You must withhold tax on the unrelated business income (as described in Publication 598, Tax on Unrelated Business Income of Exempt Organizations) of foreign tax-exempt organizations in the same way that you would withhold tax on similar income of nonexempt organizations. State tax for free U. State tax for free S. State tax for free branches of foreign persons. State tax for free   In most cases, a payment to a U. State tax for free S. State tax for free branch of a foreign person is a payment made to the foreign person. State tax for free However, you may treat payments to U. State tax for free S. State tax for free branches of foreign banks and foreign insurance companies (discussed earlier) that are subject to U. State tax for free S. State tax for free regulatory supervision as payments made to a U. State tax for free S. State tax for free person, if you and the U. State tax for free S. State tax for free branch have agreed to do so, and if their agreement is evidenced by a withholding certificate, Form W-8IMY. State tax for free For this purpose, a financial institution organized under the laws of a U. State tax for free S. State tax for free possession is treated as a U. State tax for free S. State tax for free branch. State tax for free Documentation In most cases, you must withhold 30% from the gross amount paid to a foreign payee unless you can reliably associate the payment with valid documentation that establishes either of the following. State tax for free The payee is a U. State tax for free S. State tax for free person. State tax for free The payee is a foreign person that is the beneficial owner of the income and is entitled to a reduced rate of withholding. State tax for free In most cases, you must get the documentation before you make the payment. State tax for free The documentation is not valid if you know, or have reason to know, that it is unreliable or incorrect. State tax for free See Standards of Knowledge , later. State tax for free If you cannot reliably associate a payment with valid documentation, you must use the presumption rules discussed later. State tax for free For example, if you do not have documentation or you cannot determine the part of a payment that is allocable to specific documentation, you must use the presumption rules. State tax for free The specific types of documentation are discussed in this section. State tax for free However, see Withholding on Specific Income , later, as well as the instructions to the particular forms. State tax for free As the withholding agent, you also may want to see the Instructions for the Requester of Forms W-8BEN, W-8ECI, W-8EXP, and W-8IMY. State tax for free Section 1446 withholding. State tax for free   Under section 1446 of the Code, a partnership must withhold tax on its effectively connected income allocable to a foreign partner. State tax for free In most cases, a partnership determines if a partner is a foreign partner and the partner's tax classification based on the withholding certificate provided by the partner. State tax for free This is the same documentation that is filed for NRA withholding, but may require additional information as discussed under each of the forms in this section. State tax for free Joint owners. State tax for free    If you make a payment to joint owners, you need to get documentation from each owner. State tax for free Form W-9. State tax for free   In most cases, you can treat the payee as a U. State tax for free S. State tax for free person if the payee gives you a Form W-9. State tax for free The Form W-9 can be used only by a U. State tax for free S. State tax for free person and must contain the payee's taxpayer identification number (TIN). State tax for free If there is more than one owner, you may treat the total amount as paid to a U. State tax for free S. State tax for free person if any one of the owners gives you a Form W-9. State tax for free See U. State tax for free S. State tax for free Taxpayer Identification Numbers , later. State tax for free U. State tax for free S. State tax for free persons are not subject to NRA withholding, but may be subject to Form 1099 reporting and backup withholding. State tax for free Form W-8. State tax for free   In most cases, a foreign payee of the income should give you a form in the Form W-8 series. State tax for free Until further notice, you can rely upon Forms W-8 that contain a P. State tax for free O. State tax for free box as a permanent residence address provided you do not know, or have reason to know, that the person providing the form is a U. State tax for free S. State tax for free person and that a street address is available. State tax for free You may rely on Forms W-8 for which there is a U. State tax for free S. State tax for free mailing address provided you received the form prior to December 31, 2001. State tax for free   If certain requirements are met, the foreign person can give you documentary evidence, rather than a Form W-8. State tax for free You can rely on documentary evidence in lieu of a Form W-8 for a payment made in a U. State tax for free S. State tax for free possession. State tax for free Other documentation. State tax for free   Other documentation may be required to claim an exemption from, or a reduced rate of, withholding on pay for personal services. State tax for free The nonresident alien individual may have to give you a Form W-4 or a Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual. State tax for free These forms are discussed in Pay for Personal Services Performed under Withholding on Specific Income. State tax for free Beneficial Owners If all the appropriate requirements have been established on a Form W-8BEN, W-8ECI, W-8EXP or, if applicable, on documentary evidence, you may treat the payee as a foreign beneficial owner. State tax for free Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding. State tax for free   This form is used by a foreign person to: Establish foreign status; Claim that such person is the beneficial owner of the income for which the form is being furnished or a partner in a partnership subject to section 1446 withholding; and If applicable, claim a reduced rate of, or exemption from, withholding under an income tax treaty. State tax for free   Form W-8BEN also may be used to claim that the foreign person is exempt from Form 1099 reporting and backup withholding for income that is not subject to NRA withholding. State tax for free For example, a foreign person may provide a Form W-8BEN to a broker to establish that the gross proceeds from the sale of securities are not subject to Form 1099 reporting or backup withholding. State tax for free Claiming treaty benefits. State tax for free   You may apply a reduced rate of withholding to a foreign person that provides a Form W-8BEN claiming a reduced rate of withholding under an income tax treaty only if the person provides a U. State tax for free S. State tax for free TIN and certifies that: It is a resident of a treaty country; It is the beneficial owner of the income; If it is an entity, it derives the income within the meaning of section 894 of the Internal Revenue Code (it is not fiscally transparent); and It meets any limitation on benefits provision contained in the treaty, if applicable. State tax for free   If the foreign beneficial owner claiming a treaty benefit is related to you, the foreign beneficial owner also must certify on Form W-8BEN that it will file Form 8833, Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b), if the amount subject to NRA withholding received during a calendar year exceeds, in the aggregate, $500,000. State tax for free   An entity derives income for which it is claiming treaty benefits only if the entity is not treated as fiscally transparent for that income. State tax for free See Fiscally transparent entity discussed earlier under Flow-Through Entities. State tax for free   Limitations on benefits provisions generally prohibit third country residents from obtaining treaty benefits. State tax for free For example, a foreign corporation may not be entitled to a reduced rate of withholding unless a minimum percentage of its owners are citizens or residents of the United States or the treaty country. State tax for free   The exemptions from, or reduced rates of, U. State tax for free S. State tax for free tax vary under each treaty. State tax for free You must check the provisions of the tax treaty that apply. State tax for free Tables at the end of this publication show the countries with which the United States has income tax treaties and the rates of withholding that apply in cases where all conditions of the particular treaty articles are satisfied. State tax for free   If you know, or have reason to know, that an owner of income is not eligible for treaty benefits claimed, you must not apply the treaty rate. State tax for free You are not, however, responsible for misstatements on a Form W-8, documentary evidence, or statements accompanying documentary evidence for which you did not have actual knowledge, or reason to know, that the statements were incorrect. State tax for free Exceptions to TIN requirement. State tax for free   A foreign person does not have to provide a TIN to claim a reduced rate of withholding under a treaty if the requirements for the following exceptions are met. State tax for free Income from marketable securities (discussed next). State tax for free Unexpected payments to an individual (discussed under U. State tax for free S. State tax for free Taxpayer Identification Numbers ). State tax for free Marketable securities. State tax for free   A Form W-8BEN provided to claim treaty benefits does not need a U. State tax for free S. State tax for free TIN if the foreign beneficial owner is claiming the benefits on income from marketable securities. State tax for free For this purpose, income from a marketable security consists of the following items. State tax for free Dividends and interest from stocks and debt obligations that are actively traded. State tax for free Dividends from any redeemable security issued by an investment company registered under the Investment Company Act of 1940 (mutual fund). State tax for free Dividends, interest, or royalties from units of beneficial interest in a unit investment trust that are (or were upon issuance) publicly offered and are registered with the SEC under the Securities Act of 1933. State tax for free Income related to loans of any of the above securities. State tax for free Offshore accounts. State tax for free   If a payment is made outside the United States to an offshore account, a payee may give you documentary evidence, rather than Form W-8BEN. State tax for free   In most cases, a payment is made outside the United States if you complete the acts necessary to effect the payment outside the United States. State tax for free However, an amount paid by a bank or other financial institution on a deposit or account usually will be treated as paid at the branch or office where the amount is credited. State tax for free An offshore account is an account maintained at an office or branch of a U. State tax for free S. State tax for free or foreign bank or other financial institution at any location outside the United States. State tax for free   You may rely on documentary evidence given to you by a nonqualified intermediary or a flow-through entity with its Form W-8IMY. State tax for free This rule applies even though you make the payment to a nonqualified intermediary or flow-through entity in the United States. State tax for free In most cases, the nonqualified intermediary or flow-through entity that gives you documentary evidence also will have to give you a withholding statement, discussed later. State tax for free Documentary evidence. State tax for free   You may apply a reduced rate of withholding to income from marketable securities (discussed earlier) paid outside the United States to an offshore account if the beneficial owner gives you documentary evidence in place of a Form W-8BEN. State tax for free To claim treaty benefits, the documentary evidence must be one of the following: A certificate of residence that: Is issued by a tax official of the treaty country of which the foreign beneficial owner claims to be a resident, States that the person has filed its most recent income tax return as a resident of that country, and Is issued within 3 years prior to being presented to you. State tax for free Documentation for an individual that: Includes the individual's name, address, and photograph, Is an official document issued by an authorized governmental body, and Is issued no more than 3 years prior to being presented to you. State tax for free Documentation for an entity that: Includes the name of the entity, Includes the address of its principal office in the treaty country, and Is an official document issued by an authorized governmental body. State tax for free In addition to the documentary evidence, a foreign beneficial owner that is an entity must provide a statement that it derives the income for which it claims treaty benefits and that it meets one or more of the conditions set forth in a limitation on benefits article, if any, (or similar provision) contained in the applicable treaty. State tax for free Form W-8ECI, Certificate of Foreign Person's Claim That Income Is Effectively Connected With the Conduct of a Trade or Business in the United States. State tax for free   This form is used by a foreign person to: Establish foreign status, Claim that such person is the beneficial owner of the income for which the form is being furnished, and Claim that the income is effectively connected with the conduct of a trade or business in the United States. State tax for free (See Effectively Connected Income , later. State tax for free )   Effectively connected income for which a valid Form W-8ECI has been provided is generally not subject to NRA withholding. State tax for free   If a partner submits this form to a partnership, the income claimed to be effectively connected with the conduct of a U. State tax for free S. State tax for free trade or business is subject to withholding under section 1446. State tax for free If the partner has made, or will make, an election under section 871(d) or 882(d), the partner must submit Form W-8ECI, and attach a copy of the election, or a statement of intent to elect, to the form. State tax for free    If the partner's only effectively connected income is the income allocated from the partnership and the partner is not making the election under section 871(d) or 882(d), the partner should provide Form W-8BEN to the partnership. State tax for free Form W-8EXP, Certificate of Foreign Government or Other Foreign Organization for United States Tax Withholding. State tax for free   This form is used by a foreign government, international organization, foreign central bank of issue, foreign tax-exempt organization, foreign private foundation, or government of a U. State tax for free S. State tax for free possession to: Establish foreign status, Claim that such person is the beneficial owner of the income for which the form is being furnished, and Claim a reduced rate of, or an exemption from, withholding as such an entity. State tax for free   If the government or organization is a partner in a partnership carrying on a trade or business in the United States, the effectively connected income allocable to the partner is subject to withholding under section 1446. State tax for free   See Foreign Governments and Certain Other Foreign Organizations , later. State tax for free Foreign Intermediaries and Foreign Flow-Through Entities Payments made to a foreign intermediary or foreign flow-through entity are treated as made to the payees on whose behalf the intermediary or entity acts. State tax for free The Form W-8IMY provided by a foreign intermediary or flow-through entity must be accompanied by additional information for you to be able to reliably associate the payment with a payee. State tax for free The additional information required depends on the type of intermediary or flow-through entity and the extent of the withholding responsibilities it assumes. State tax for free Form W-8IMY, Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U. State tax for free S. State tax for free Branches for United States Tax Withholding. State tax for free   This form is used by foreign intermediaries and foreign flow-through entities, as well as certain U. State tax for free S. State tax for free branches, to: Represent that a foreign person is a qualified intermediary or nonqualified intermediary, Represent, if applicable, that the qualified intermediary is assuming primary NRA withholding responsibility and/or primary Form 1099 reporting and backup withholding responsibility, Represent that a foreign partnership or a foreign simple or grantor trust is a withholding foreign partnership or a withholding foreign trust, Represent that a foreign flow-through entity is a nonwithholding foreign partnership, or a nonwithholding foreign trust and that the income is not effectively connected with the conduct of a trade or business in the United States, Represent that the provider is a U. State tax for free S. State tax for free branch of a foreign bank or insurance company and either is agreeing to be treated as a U. State tax for free S. State tax for free person or is transmitting documentation of the persons on whose behalf it is acting, or Represent that, for purposes of section 1446, it is an upper-tier foreign partnership or a foreign grantor trust and that the form is being used to transmit the required documentation. State tax for free For information on qualifying as an upper-tier foreign partnership, see Regulations section 1. State tax for free 1446-5. State tax for free Qualified Intermediaries In most cases, a QI is any foreign intermediary that has entered into a QI withholding agreement (discussed earlier) with the IRS. State tax for free A foreign intermediary that has received a QI employer identification number (QI-EIN) may represent on Form W-8IMY that it is a QI before it receives a fully executed agreement. State tax for free The intermediary can claim that it is a QI until the IRS revokes its QI-EIN. State tax for free The IRS will revoke a QI-EIN if the QI agreement is not executed and returned to the IRS within a reasonable period of time after the agreement was sent to the intermediary for signature. State tax for free Responsibilities. State tax for free   Payments made to a QI that does not assume NRA withholding responsibility are treated as paid to its account holders and customers. State tax for free However, a QI is not required to provide you with documentation it obtains from its foreign account holders and customers. State tax for free Instead, it provides you with a withholding statement that contains withholding rate pool information. State tax for free A withholding rate pool is a payment of a single type of income, determined in accordance with the categories of income reported on Form 1042-S that is subject to a single rate of withholding. State tax for free A qualified intermediary is required to provide you with information regarding U. State tax for free S. State tax for free persons subject to Form 1099 reporting and to provide you withholding rate pool information separately for each such U. State tax for free S. State tax for free person unless it has assumed Form 1099 reporting and backup withholding responsibility. State tax for free For the alternative procedure for providing rate pool information for U. State tax for free S. State tax for free non-exempt persons, see the Form W-8IMY instructions. State tax for free   The withholding statement must: Designate those accounts for which it acts as a qualified intermediary, Designate those accounts for which it assumes primary NRA withholding responsibility and/or primary Form 1099 and backup withholding responsibility, and Provide sufficient information for you to allocate the payment to a withholding rate pool. State tax for free   The extent to which you must have withholding rate pool information depends on the withholding and reporting obligations assumed by the QI. State tax for free Primary responsibility not assumed. State tax for free   If a QI does not assume primary NRA withholding responsibility or primary Form 1099 reporting and backup withholding responsibility for the payment, you can reliably associate the payment with valid documentation only to the extent you can reliably determine the part of the payment that relates to each withholding rate pool for foreign payees. State tax for free Unless the alternative procedure applies, the qualified intermediary must provide you with a separate withholding rate pool for each U. State tax for free S. State tax for free person subject to Form 1099 reporting and/or backup withholding. State tax for free The QI must provide a Form W-9 or, in the absence of the form, the name, address, and TIN, if available, for such person. State tax for free Primary NRA withholding responsibility assumed. State tax for free   If you make a payment to a QI that assumes primary NRA withholding responsibility (but not primary Form 1099 reporting and backup withholding responsibility), you can reliably associate the payment with valid documentation only to the extent you can reliably determine the part of the payment that relates to the withholding rate pool for which the QI assumes primary NRA withholding responsibility and the part of the payment attributable to withholding rate pools for each U. State tax for free S. State tax for free person, unless the alternative procedure applies, subject to Form 1099 reporting and/or backup withholding. State tax for free The QI must provide a Form W-9 or, in the absence of the form, the name, address, and TIN, if available, for such person. State tax for free Primary NRA and Form 1099 responsibility assumed. State tax for free   If you make a payment to a QI that assumes both primary NRA withholding responsibility and primary Form 1099 reporting and backup withholding responsibility, you can reliably associate a payment with valid documentation provided that you receive a valid Form W-8IMY. State tax for free It is not necessary to associate the payment with withholding rate pools. State tax for free Example. State tax for free You make a payment of dividends to a QI. State tax for free It has five customers: two are foreign persons who have provided documentation entitling them to a 15% rate of withholding on dividends; two are foreign persons subject to a 30% rate of withholding on dividends; and one is a U. State tax for free S. State tax for free individual who provides it with a Form W-9. State tax for free Each customer is entitled to 20% of the dividend payment. State tax for free The QI does not assume any primary withholding responsibility. State tax for free The QI gives you a Form W-8IMY with which it associates the Form W-9 and a withholding statement that allocates 40% of the dividend to a 15% withholding rate pool, 40% to a 30% withholding rate pool, and 20% to the U. State tax for free S. State tax for free individual. State tax for free You should report on Forms 1042-S 40% of the payment as made to a 15% rate dividend pool and 40% of the payment as made to a 30% rate dividend pool. State tax for free The part of the payment allocable to the U. State tax for free S. State tax for free individual (20%) is reportable on Form 1099-DIV. State tax for free Smaller partnerships and trusts. State tax for free   A QI may apply special rules to a smaller partnership or trust (Joint Account Provision) only if the partnership or trust meets the following conditions. State tax for free It is a foreign partnership or foreign simple or grantor trust. State tax for free It is a direct account holder of the QI. State tax for free It does not have any partner, beneficiary, or owner that is a U. State tax for free S. State tax for free person or a pass- through partner, beneficiary, or owner. State tax for free   For information on these rules, see section 4A. State tax for free 01 of the QI agreement. State tax for free This is found in Appendix 3 of Revenue Procedure 2003-64. State tax for free Also see Revenue Procedure 2004-21. State tax for free Related partnerships and trusts. State tax for free    A QI may apply special rules to a related partnership or trust only if the partnership or trust meets the following conditions. State tax for free It is a foreign partnership or foreign simple or grantor trust. State tax for free It is either: A direct account holder of the QI, or An indirect account holder of the QI that is a direct partner, beneficiary, or owner of a partnership or trust to which the QI has applied this rule. State tax for free For information on these rules, see section 4A. State tax for free 02 of the QI agreement. State tax for free This is found in Appendix 3 of Revenue Procedure 2003-64. State tax for free Also see Revenue Procedure 2005-77. State tax for free Nonqualified Intermediaries If you are making a payment to an NQI, foreign flow-through entity, or U. State tax for free S. State tax for free branch that is using Form W-8IMY to transmit information about the branch's account holders or customers, you can treat the payment (or a part of the payment) as reliably associated with valid documentation from a specific payee only if, prior to making the payment: You can allocate the payment to a valid Form W-8IMY, You can reliably determine how much of the payment relates to valid documentation provided by a payee (a person that is not itself a foreign intermediary, flow- through entity, or U. State tax for free S. State tax for free branch), and You have sufficient information to report the payment on Form 1042-S or Form 1099, if reporting is required. State tax for free The NQI, flow-through entity, or U. State tax for free S. State tax for free branch must give you certain information on a withholding statement that is associated with the Form W-8IMY. State tax for free A withholding statement must be updated to keep the information accurate prior to each payment. State tax for free Withholding statement. State tax for free   In most cases, a withholding statement must contain the following information. State tax for free The name, address, and TIN (if any, or if required) of each person for whom documentation is provided. State tax for free The type of documentation (documentary evidence, Form W-8, or Form W-9) for every person for whom documentation has been provided. State tax for free The status of the person for whom the documentation has been provided, such as whether the person is a U. State tax for free S. State tax for free exempt recipient (U. State tax for free S. State tax for free person exempt from Form 1099 reporting), U. State tax for free S. State tax for free non-exempt recipient (U. State tax for free S. State tax for free person subject to Form 1099 reporting), or a foreign person. State tax for free For a foreign person, the statement must indicate whether the person is a beneficial owner or a foreign intermediary, flow-through entity, or a U. State tax for free S. State tax for free branch. State tax for free The type of recipient the person is, based on the recipient codes used on Form 1042-S. State tax for free Information allocating each payment, by income type, to each payee (including U. State tax for free S. State tax for free exempt and U. State tax for free S. State tax for free non-exempt recipients) for whom documentation has been provided. State tax for free The rate of withholding that applies to each foreign person to whom a payment is allocated. State tax for free A foreign payee's country of residence. State tax for free If a reduced rate of withholding is claimed, the basis for a reduced rate of withholding (for example, portfolio interest, treaty benefit, etc. State tax for free ). State tax for free In the case of treaty benefits claimed by entities, whether the applicable limitation on benefits statement and the statement that the foreign person derives the income for which treaty benefits are claimed, have been made. State tax for free The name, address, and TIN (if any) of any other NQI, flow-through entity, or U. State tax for free S. State tax for free branch from which the payee will directly receive a payment. State tax for free Any other information a withholding agent requests to fulfill its reporting and withholding obligations. State tax for free Alternative procedure. State tax for free   Under this alternative procedure the NQI can give you the information that allocates each payment to each foreign and U. State tax for free S. State tax for free exempt recipient by January 31 following the calendar year of payment, rather than prior to the payment being made as otherwise required. State tax for free To take advantage of this procedure, the NQI must: (a) inform you, on its withholding statement, that it is using the alternative procedure; and (b) obtain your consent. State tax for free You must receive the withholding statement with all the required information (other than item 5) prior to making the payment. State tax for free    This alternative procedure cannot be used for payments to U. State tax for free S. State tax for free non-exempt recipients. State tax for free Therefore, an NQI must always provide you with allocation information for all U. State tax for free S. State tax for free non-exempt recipients prior to a payment being made. State tax for free Pooled withholding information. State tax for free   If an NQI uses the alternative procedure, it must provide you with withholding rate pool information, as opposed to individual allocation information, prior to the payment of a reportable amount. State tax for free A withholding rate pool is a payment of a single type of income (as determined by the income categories on Form 1042-S) that is subject to a single rate of withholding. State tax for free For example, an NQI that has foreign account holders receiving royalties and dividends, both subject to the 15% rate, will provide you with information for two withholding rate pools (one for royalties and one for dividends). State tax for free The NQI must provide you with the payee specific allocation information (information allocating each payment to each payee) by January 31 following the calendar year of payment. State tax for free Failure to provide allocation information. State tax for free   If an NQI fails to provide you with the payee specific allocation information for a withholding rate pool by January 31, you must not apply the alternative procedure to any of the NQI's withholding rate pools from that date forward. State tax for free You must treat the payees as undocumented and apply the presumption rules, discussed later in Presumption Rules . State tax for free An NQI is deemed to have f