The Internal Revenue provided information Tuesday on how the Foreign Account Tax Compliance Act will be administered.
FATCA was included as part of the HIRE Act of 2010 and requires foreign banks to provide information to the IRS on the holdings of U.S. taxpayers. In a FATCA newsletter Tuesday, the IRS said that while the final regulations for foreign financial institutions under FATCA have not yet been issued, some basics of the administration of the Qualified Intermediary Program and FATCA implementation are known. QIs are foreign banks and other financial institutions that are authorized to withhold taxes from U.S. depositors on behalf of the IRS. The IRS noted that QIs must become FATCA compliant to retain their QI status and the QI agreement will be modified to reflect the Chapter 4 requirements.
The IRS added that renewal of the QI agreement for QIs whose renewal is expiring Dec. 31, 2012 has been extended under Notice 2011-53 until Dec. 31, 2013.
The renewal of the QI agreement will be accomplished through the online FATCA FFI registration system. The online registration system will be available no later than Jan. 1, 2013, according to the IRS.
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