IRS Explains Interest-Free Rule for FATCA Withholding Overpayments

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IRS provides guidance to the field on the 180-day interest-free rule for overpayments resulting from Chapter 3 withholding under the Foreign Account Tax Compliance Act. In a memorandum provided by IRS's Small Business/Self-Employed Division (SBSE-20-0311-0572), the agency says the new 180-day rule applies to certain adjustments and refunds after March 18, 2010. The rule covers refunds after the return is filed, refunds after claim for credit or refund, or certain IRS-initiated adjustments.