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DRAFT Form W-8ECI And Instructions

On August 25, 2021, the IRS published a DRAFT Form W-8ECI and Instructions with a revision date of October 2021.

Updates to the face of the form include:

  • New Line 12, Securities Dealer Exception from Section 1446(f) withholding. Incorporates the use of Form W-8ECI for transfers of Publicly Traded Partnership (PTP) interests by dealers in securities eligible to claim an exception from the withholding under the final regulations. Withholding on transfers of interests in PTPs and related provisions of those final regulations apply to transfers that occur on or after January 1, 2023.
  • Updates to Line 4, “Type of entity.” Removed classification for ‘foreign government’ and replaced it with the two possible classifications for a foreign government: (i) an integral part of a foreign government; or (ii) an entity that is controlled by a foreign government. See Temporary Regulations section 1.892-2T.
  • New Line 8a, “Foreign tax identifying number (FTIN).” This line is for account holders to enter their FTIN.
  • New Line 8b, “Check if FTIN not legally required.” This line is for account holders otherwise required to provide a foreign taxpayer identification number (FTIN) on new line 8a to indicate that they are not legally required to obtain an FTIN from their jurisdiction of residence.

Updates to the Instructions include:

  • Details regarding all new and updated lines on the face of the form.
  • Section 6050Y(b) reporting. Form W-8ECI usage by a non-U.S. seller of a life insurance contract or interest therein for purposes of the reporting required under section 6050Y(b). See Regulations section 1.6050Y-3(f)(1).
  • Electronic Signature. Additional guidance regarding the final regulations issued under chapter 3 (TD 9890) concerning the use of electronic signatures on withholding certificates.

Check out the DRAFT 2021 Form W-8ECI here: https://www.irs.gov/pub/irs-dft/fw8eci–dft.pdf

Check out the DRAFT 2021 Instructions for Form W-8ECI here: https://www.irs.gov/pub/irs-dft/iw8eci–dft.pdf

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DRAFT Form W-8ECI And Instructions

This document contains general information only and is not a substitute for accounting, tax, or any other professional advice or services. The information provided is considered accurate at the time of publishing and will not be updated with new regulation requirements.

Comply Connect May 2024 – Issue 11

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