July 2024 | Issue 13
Comply Connect
Designed to not only keep you up to date with all things information reporting, but also to provide valuable insights into what lies ahead in the upcoming month.
Coming Up in August
Discover the U.S. information reporting and withholding obligations you should keep an eye on in the coming month.
Key Updates
Explore the Key updates provided by the IRS and other tax authorities from the last month you should be aware of.
FATCA & CRS Headlines
Take a look at our breakdown of the latest FATCA & CRS headlines to keep you up to date.
A message from our cEO:
With the IRS implementing new regulations regarding cryptocurrency and digital assets, Comply Exchange is positioned to deliver comprehensive solutions. Our dedicated team has developed strategies to ensure full compliance while maintaining operational efficiency. We are addressing the complex challenges presented by these evolving regulations, integrating them seamlessly into our existing processes.
Furthermore, I am proud to emphasize our commitment to cultivating an outstanding company culture. We recognize that our people are our greatest asset, and their development is vital to our success. By investing in our team’s professional growth, we ensure that every member of Comply Exchange is equipped to support our clients and uphold our reputation for excellence. This dedication to continuous learning and innovation is what sets us apart and propels our mission forward.
Coming up in August
U.S. Russia Tax Treaty
As of August 16, 2024, the income tax treaty between the U.S. and Russia will be suspended, meaning that taxpayers will no longer be able to claim reduced rates of withholding as previously allowed under the tax treaty. The suspension will take effect both for taxes withheld at source and in respect of other taxes on August 16, 2024, and will remain in effect indefinitely.
Withholding agents should update the necessary flows and procedures to account for this change and the new withholding rates.
Barbados: FATCA & CRS Filing Extension
The Barbados Revenue Authority (“the Authority”) published a Guidance Note advising Reporting Barbados Financial Institutions that the filing deadline for both FATCA and CRS reports for the reporting period of 2023 has been extended to Friday, August 16, 2024.
IRS: FATCA IDES Testing Window
On July 30, 2024, the IRS published a notice noting that the FATCA International Data Exchange Service (IDES) testing window has been revised and extended to August 9, 2024.
July 2024 Key Updates
Digital Asset Final Regulations
On June 28, the U.S. Department of the Treasury and the IRS issued final regulations requiring custodial brokers to report digital asset transactions, including cryptocurrency sales and exchanges, starting in 2025. This effort aims to help taxpayers file accurate tax returns and improve compliance in the digital asset space.
The new regulations are a response to over 44,000 public comments and reflect a balance between industry concerns and closing the tax gap. They apply to brokers who hold digital assets for their customers, such as trading platforms, wallet providers, kiosks, and certain payment processors. Brokers must report transactions on the soon-to-be-released Form 1099-DA. The rules for non-custodial and decentralized brokers will be addressed in future regulations.
Key features include rules for determining the basis, gain, and loss from digital asset transactions, and backup withholding requirements. Transitional relief is provided for brokers making a good faith effort to comply during 2025, and limited relief extends to 2026 for certain cases.
Form 1099-MISC
On July 11, the IRS released a draft of the Form 1099-MISC (Rev. March 2025)
IRS Issue Numbers 2024-17 & 2024-18: In Person QI Agreement Presentations
On July 15, 2024, the IRS published Issue Numbers 2024-17 and 2024-18 noting that they will be hosting in person presentations in Denmark and Germany on the new QI Agreement and completing Forms 1042/1042-S. There is no cost to attend these presentations, but you must reserve a seat as seating is limited.
IRS Issue Number 2024-20: QI, WP, WT Application Deadline for 2024
On July 30, 2024, the IRS published Issue Number 2024-20 alerting all Qualified Intermediaries (including Qualified Derivatives Dealers), Withholding Foreign Partnerships, and Withholding Foreign Trusts that applications for the 2024 year must be submitted through the Qualified Intermediary, Withholding Foreign Partnership, Withholding Foreign Trust Application & Account Management System (QAAMS) no later than September 30, 2024.
July 2024 FATCA & CRS Headlines
IRS: FATCA REGISTRATION
On July 2, the IRS announced enhancements to the identity authentication process for financial institutions registering under the Foreign Account Tax Compliance Act (FATCA). As of July 14, taxpayers must sign in or register with one of the IRS’s credential service providers to access the FATCA Registration System.
Taxpayers with existing profiles can sign in to the FATCA Registration System if the email matches that of the responsible officer or point of contact on the FATCA registration. Those without profiles must create one to access the system. This new authentication requirement adheres to National Institute of Standards and Technology (NIST) digital identity guidelines.
To create a new profile with either Login.gov or ID.me, taxpayers must verify their email address, create a password, and set up multi-factor authentication to secure their FATCA account. Both ID.me and Login.gov provide help desks to assist taxpayers with system issues.
Cayman Islands: DITC Portal User Guide
The Cayman Islands Department for International Tax Cooperation (DITC) published an updated DITC Portal User Guide v.9.4.
Singapore: Updated CRS FAQs
On July 25, 2024, the Inland Revenue Authority of Singapore (IRAS) published updated FAQs on CRS. FAQ F.9 was updated to provide clarity on how to report the account balance or value of account holders of a trust that is an Investment Entity
St. Vincent and the Grenadines: FATCA & CRS Reporting Notice
On July 15, 2024, the Inland Revenue Department of St. Vincent and the Grenadines published a notice advising that the AEOI portal will be available for submission of FATCA and CRS reports for the 2024 period from Wednesday, July 17, 2024, to Friday, August 30, 2024. The notice also included FATCA reminders regarding reporting of TINs.
