IRS Should Ease FATCA Compliance for Withholding Agents, SIFMA Says

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The Securities Industry and Financial Markets Association is asking the government to ease the burden on agents who must withhold under the Foreign Account Tax Compliance Act, saying agents should be allowed to rely on electronic documentation submitted by investment advisers, fund managers, introducing brokers or other financial intermediaries.
In a letter to the Internal Revenue Service and the Treasury Department, SIFMA said challenges for withholding agents under the current FATCA rules could lead to excessive withholding. In turn, this could discourage foreign investors from buying assets in the U.S., the group said.
Among those challenges are documentation requirements and a broad standard for when agents have “reason to know” that a payment is subject to withholding, SIFMA said.

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