# Rev. Proc. 2017-21: Rev. Proc. 2017-21

> Federal · IRS revenue procedures · In force

URL: https://www.frixlaw.com/law-library/statutes/IRS_RP_2017_21

## Section

- **Citation:** Rev. Proc. 2017-21
- **Heading:** Rev. Proc. 2017-21
- **Jurisdiction:** Federal
- **Kind:** IRS revenue procedures
- **Status:** In force
- **Text as of:** August 14, 2026
- **Source:** Compiled text
- **Location:** Internal Revenue Bulletin / IRB 2017 / Revenue Procedure / Rev. Proc. 2017-21

## Text

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Updated Withholding Foreign Partnership Agreement and Withholding Foreign Trust Agreement

Revenue Procedure 2017-21

SECTION 1. PURPOSE

This revenue procedure sets forth the withholding foreign partnership agreement (WP
agreement) and withholding foreign trust agreement (WT agreement) entered into under
§1.1441-5(c)(2)(ii) and (e)(5)(v). In general, the WP and WT agreements allow a foreign
partnership or foreign trust to assume the withholding and reporting obligations under chapters
3 and 4 of the Internal Revenue Code (Code) for certain payments of U.S. source income (such
as interest, dividends, and royalties) made to its direct partners, beneficiaries, or owners, and in
some cases, persons holding interests in the partnership or trust through one or more foreign
intermediaries or flow-through entities (indirect partners). This revenue procedure also provides
guidance to foreign partnerships and foreign trusts for how to apply to enter into, or renew, the
WP or WT agreement.

The WP agreement and WT agreement provided in Revenue Procedure 2014-47, 2014-
35 I.R.B. 393 (the 2014 WP agreement and 2014 WT agreement), were scheduled to expire on
December 31, 2016, but on December 30, 2016, the Department of the Treasury (Treasury
Department) and the Internal Revenue Service (IRS) announced in Revenue Procedure 2017-
15, 2017-03 I.R.B. 437, that the 2014 WP and WT agreements would be treated as in effect
until the updated agreements are issued in January 2017. The WP and WT agreements in this
WT agreement), were scheduled to expire on
December 31, 2016, but on December 30, 2016, the Department of the Treasury (Treasury
Department) and the Internal Revenue Service (IRS) announced in Revenue Procedure 2017-
15, 2017-03 I.R.B. 437, that the 2014 WP and WT agreements would be treated as in effect
until the updated agreements are issued in January 2017. The WP and WT agreements in this

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revenue procedure apply to withholding foreign partnerships (WPs) and withholding foreign
trusts (WTs) with a WP or WT agreement effective on or after the date of issuance of this
revenue procedure (but see section 12 of the WP or WT agreement for when the terms of the
revised WP or WT agreement will apply).
Section 2 of this revenue procedure provides background on the withholding and
reporting requirements of chapters 3 and 4 of the Code. Section 3 of this revenue procedure
describes the scope of this revenue procedure, and section 4 of this revenue procedure
highlights changes to the WP and WT agreements. Section 5 of this revenue procedure
provides the application procedures for becoming a WP or WT and for renewing a WP or WT
agreement. Section 6 of this revenue procedure provides the WP agreement and section 7 of
this revenue procedure provides the WT agreement. Section 8 of this revenue procedure
provides the effective date; section 9 provides the effect on other documents; section 10
describes the collection of information burdens under the Paperwork Reduction Act; and section
11 provides drafting information.
SECTION 2. BACKGROUND

.01 Withholding and Reporting under Chapter 4 of the Code. On March 18, 2010, the
Hiring Incentives to Restore Employment Act of 2010, Pub. L. 111-147, added chapter 4 of
Subtitle A (chapter 4 or FATCA) of the Code, comprised of sections 1471 through 1474
llection of information burdens under the Paperwork Reduction Act; and section
11 provides drafting information.
SECTION 2. BACKGROUND

.01 Withholding and Reporting under Chapter 4 of the Code. On March 18, 2010, the
Hiring Incentives to Restore Employment Act of 2010, Pub. L. 111-147, added chapter 4 of
Subtitle A (chapter 4 or FATCA) of the Code, comprised of sections 1471 through 1474. On
January 28, 2013, the Treasury Department and the IRS published final regulations (TD 9610)
under chapter 4 in the Federal Register (78 FR 5874), and, on September 10, 2013, published
corrections to those final regulations (collectively, the 2013 chapter 4 regulations). On March 6,
2014, the Treasury Department and IRS published temporary regulations (T.D. 9657) providing
clarifications and modifications to the 2013 final regulations (as corrected, the 2014 temporary
regulations). On January 6, 2017, the Treasury Department and IRS published regulations
finalizing the 2014 temporary regulations with certain modifications (final chapter 4 regulations)

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and published temporary regulations providing additional rules under chapter 4 (temporary
chapter 4 regulations) (T.D. 9809, 82 FR 2124).

Section 1471(a) requires a withholding agent to deduct and withhold a tax equal to 30
percent on any withholdable payment made to a foreign financial institution (FFI), unless the FFI
agrees to and complies with the terms of an FFI agreement (published in Revenue Procedure
2017-16, 2017-03 I.R.B. 501 (as updated or superseded by any subsequent revenue
procedure)) to satisfy the obligations specified in section 1471(b) (a participating FFI), is
deemed to meet these requirements under section 1471(b) (a deemed-compliant FFI), or is
treated as an exempt beneficial owner under §1.1471-6
and complies with the terms of an FFI agreement (published in Revenue Procedure
2017-16, 2017-03 I.R.B. 501 (as updated or superseded by any subsequent revenue
procedure)) to satisfy the obligations specified in section 1471(b) (a participating FFI), is
deemed to meet these requirements under section 1471(b) (a deemed-compliant FFI), or is
treated as an exempt beneficial owner under §1.1471-6. Section 1472(a) requires a withholding
agent to deduct and withhold a tax equal to 30 percent on any withholdable payment made to a
non-financial foreign entity (NFFE), other than an excepted NFFE, unless such entity provides
information regarding its substantial U.S. owners or certifies that it does not have any such
owners.

.02 Withholding and Reporting under Chapter 3 of the Code. Under sections 1441 and
1442, a withholding agent is required to deduct and withhold a tax equal to 30 percent on any
payment of U.S. source fixed or determinable, annual or periodical (FDAP) income that is an
amount subject to withholding (as defined in §1.1441-2(a)) made to a foreign person. A
reduced rate of withholding may apply under the Code (for example, section 1443) or an income
tax treaty. Generally, a withholding agent must report the payments on Forms 1042-S,
regardless of whether withholding is required. See §1.1461-1(c).

.03 Coordination of Withholding and Reporting Requirements under Chapters 3 and 4 of
the Code. On March 6, 2014, the Treasury Department and IRS published temporary
regulations (T.D. 9658) providing rules under chapters 3, 61, and section 3406 of the Code to
coordinate with the requirements provided in the 2013 final regulations and 2014 temporary
regulations (as corrected, the temporary coordination regulations). On January 6, 2017, the
Treasury Department and IRS published regulations finalizing certain temporary regulations
nd IRS published temporary
regulations (T.D. 9658) providing rules under chapters 3, 61, and section 3406 of the Code to
coordinate with the requirements provided in the 2013 final regulations and 2014 temporary
regulations (as corrected, the temporary coordination regulations). On January 6, 2017, the
Treasury Department and IRS published regulations finalizing certain temporary regulations

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under chapters 3 and 61 and sections 3406 and 6402 (final chapter 3 regulations) and
published temporary regulations providing additional rules under chapter 3 (temporary chapter 3
regulations) (T.D. 9808, 82 FR 2046).

With respect to a payment that is subject to withholding under chapter 4, a withholding
agent may credit any tax withheld under chapter 4 against its liability for any tax due with
respect to the payment under chapter 3. A withholding agent is required to use a single Form
1042-S to report information required under both chapters 3 and 4 with respect to a payment
subject to withholding under both chapters 3 and 4 for which a credit against the beneficial
owner’s chapter 3 liability, if any, may be claimed. With respect to a withholdable payment that
is not subject to withholding under chapter 4 and that is an amount subject to withholding under
chapter 3, a withholding agent is also required to report the applicable chapter 4 exemption
code for the payment and the recipient’s chapter 4 status.

.04 Reporting Regarding Certain U.S. Persons by Foreign Partnerships and Foreign
Trusts. If a foreign partnership has U.S. partners, the foreign partnership is generally required to
file Form 1065 with a Schedule K-1 to report each U.S. partner. See §1.6031(a)-1. If a U.S.
person is treated as the owner of any portion of a foreign trust under the grantor trust rules
(sections 671 through 679 of the Code), the foreign trust is required to file Form 3520-A,
“Annual Information Return of a Foreign Trust with a U.S. Owner,” and to provide statements to
each U.S
required to
file Form 1065 with a Schedule K-1 to report each U.S. partner. See §1.6031(a)-1. If a U.S.
person is treated as the owner of any portion of a foreign trust under the grantor trust rules
(sections 671 through 679 of the Code), the foreign trust is required to file Form 3520-A,
“Annual Information Return of a Foreign Trust with a U.S. Owner,” and to provide statements to
each U.S. owner, as well as to each U.S. person who is not an owner and receives a
distribution. See section 6048(b); see also the Instructions for Form 3520-A.
SECTION 3. SCOPE

.01 Entities Eligible to Execute a WP or WT Agreement. The WP agreement may be
entered into by a foreign partnership described in §1.1441-5(c)(2)(ii), and the WT agreement
may be entered into by a foreign trust described in §1.1441-5(e)(5)(v). With respect to an FFI,
the WP or WT agreement may only be entered into by an FFI that agrees to satisfy the
requirements and obligations of a participating FFI, registered deemed-compliant FFI, or

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registered deemed-compliant Model 1 IGA FFI. An FFI that is a retirement fund (as defined in
section 2 of the WP or WT agreement) or a NFFE may also apply to enter into a WP or WT
agreement. A partnership or trust that is a territory financial institution (as defined in §1.1471-
1(b)(130)) may not enter into a WP or WT agreement. An FFI that is a foreign reverse hybrid
entity (as defined in section 2 of the WP agreement) may apply to enter into a WP agreement,
provided that the FFI is a participating FFI, a registered deemed-compliant FFI, or a registered
deemed-compliant Model 1 IGA FFI. See section 4.03 of this revenue procedure for a summary
of the requirements in the WP agreement applicable to a foreign reverse hybrid entity.

.02 Chapter 4 Requirements with Respect to Financial Accounts. As described in
section 2.01 of this revenue procedure, certain FFIs have withholding and reporting obligations
under chapter 4 with respect to the FFI’s financial accounts
l 1 IGA FFI. See section 4.03 of this revenue procedure for a summary
of the requirements in the WP agreement applicable to a foreign reverse hybrid entity.

.02 Chapter 4 Requirements with Respect to Financial Accounts. As described in
section 2.01 of this revenue procedure, certain FFIs have withholding and reporting obligations
under chapter 4 with respect to the FFI’s financial accounts. Under §1.1471-5(b)(1), a financial
account is defined broadly, and includes, for example, non-publicly traded equity interests in an
FFI that is an investment entity (as defined in §1.1471-4(e)(4)(i)). Therefore, if a WP or WT is
an FFI, WP’s or WT’s direct partners, beneficiaries, or owners are generally considered account
holders for purposes of chapter 4, and the WP or WT will be required to comply with the
withholding and reporting requirements applicable to its chapter 4 status.

.03 Assumption of Primary Chapters 3 and 4 Withholding Responsibilities. The WP and
WT agreements require a foreign partnership or foreign trust to assume primary withholding
responsibilities under chapters 3 and 4 with respect to the WP’s or WT’s direct partners,
beneficiaries, or owners, and permit the WP or WT to assume primary withholding
responsibilities under chapters 3 and 4 for certain indirect partners, beneficiaries, or owners.
Section 2.09 of the WP and WT agreements defines chapter 3 to mean sections 1441, 1442,
1443, 1461, 1463, and 1464. The WP and WT agreements do not permit a WP or WT to
assume primary withholding responsibility under section 1445 or 1446.

.04 Indirect Partners, Beneficiaries, or Owners That Are U.S. Non-Exempt Recipients. A
WP or WT must act in its capacity as a WP or WT for reportable amounts that are distributed to,
reements defines chapter 3 to mean sections 1441, 1442,
1443, 1461, 1463, and 1464. The WP and WT agreements do not permit a WP or WT to
assume primary withholding responsibility under section 1445 or 1446.

.04 Indirect Partners, Beneficiaries, or Owners That Are U.S. Non-Exempt Recipients. A
WP or WT must act in its capacity as a WP or WT for reportable amounts that are distributed to,

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or included in the distributive share of, the WP’s or WT’s direct partners, beneficiaries, or
owners. A WP or WT may also act as a WP or WT for reportable amounts that are distributed
to, or included in the distributive share of, certain indirect partners, beneficiaries, or owners.
Although §1.1441-5(c)(2)(ii) and (e)(5)(v) authorize the IRS to enter into an agreement with a
WP or WT to permit it to act as a withholding agent or payor under chapters 3, 4, and 61, and
section 3406, the WP and WT agreements do not cover chapter 61 or section 3406.
Accordingly, a WP or WT may only act as a WP or WT for an indirect partner, beneficiary, or
owner that is a U.S. non-exempt recipient if the indirect partner, beneficiary, or owner is
included in the passthrough partner’s, beneficiary’s, or owner’s chapter 4 withholding rate pool
of U.S. payees or recalcitrant account holders. If the indirect partner, beneficiary, or owner that
is a U.S. non-exempt recipient is not included in the passthrough partner’s, beneficiary’s, or
owner’s chapter 4 withholding rate pool, the WP or WT cannot act as a WP or WT for such
indirect partner, beneficiary, or owner, and must pass up specific documentation on such
indirect partner, beneficiary, or owner to the withholding agent paying the reportable amount.
See section 9.03(A) of the WP or WT agreement on the treatment of indirect partners,
beneficiaries, or owners under each of these agreements.
SECTION 4. CHANGES TO THE WP AND WT AGREEMENTS

This section summarizes the significant changes to the WP and WT agreements
p specific documentation on such
indirect partner, beneficiary, or owner to the withholding agent paying the reportable amount.
See section 9.03(A) of the WP or WT agreement on the treatment of indirect partners,
beneficiaries, or owners under each of these agreements.
SECTION 4. CHANGES TO THE WP AND WT AGREEMENTS

This section summarizes the significant changes to the WP and WT agreements.
Several of these changes are made to conform with the final and temporary chapter 3
regulations, the final and temporary chapter 4 regulations, Notice 2016-42, 2016-29 I.R.B. 67,
and Revenue Procedure 2017-15.

.01 Compliance Procedures (In General). Notice 2016-42 sets forth a draft qualified
intermediary (QI) agreement with proposed updates and modifications, and announced that the
proposed changes to the QI compliance review are intended, with appropriate modifications, to
be incorporated in the revised WP and WT agreements. Revenue Procedure 2017-15 sets forth
the final QI agreement for QIs with a QI agreement effective on or after January 1, 2017 (the

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2017 QI agreement). Accordingly, the compliance procedures in the WP and WT agreements
are updated to include compliance review procedures similar to the compliance procedures in
the 2017 QI agreement. For example, the WP and WT agreements allow the responsible officer
to make the certification of internal controls based on, in addition to the periodic review (if
required), any other reasonable processes, procedures, reviews, or certifications made by other
persons that the responsible officer has determined are necessary in order to make the
responsible officer’s periodic certification of compliance. The WP and WT agreements also
provide that the review may be conducted for any calendar year covered by the certification
period, rather than the most recent calendar year
r reasonable processes, procedures, reviews, or certifications made by other
persons that the responsible officer has determined are necessary in order to make the
responsible officer’s periodic certification of compliance. The WP and WT agreements also
provide that the review may be conducted for any calendar year covered by the certification
period, rather than the most recent calendar year. If a WP or WT chooses to review the last
year of the certification period for its periodic review, the WP or WT will also have an extended
six-month period of time to make the certification on or before December 31 of the calendar
year following the certification period (rather than July 31 of the calendar year following the
certification period). The revised WP and WT agreements also permit certain WPs and WTs
that meet the requirements in section 8.07 of the WP or WT agreement to apply for a waiver
from the periodic review requirement. A WP or WT that is a NFFE and a WP that is a member
of a consolidated compliance program may not apply for a waiver from the periodic review
requirement. As in the 2017 QI agreement, the revised WP and WT agreements require that
the reviewer have sufficient independence to objectively conduct the review and cannot review
his or her own work. See the preamble to the 2017 QI agreement for additional discussion of
the standard of independence required of a reviewer, which also apply to the WP and WT
agreements. The Appendix to the WP and WT agreements provides the certification of internal
controls, waiver request, and factual information.

Under the 2014 WP and WT agreements, the initial certification period of the WP or WT
agreement is the period ending on the third full calendar year that the WP or WT agreement is
in effect, and subsequent certification periods are every three years following the initial
certification period (other than for a WP or WT that is a NFFE or a retirement fund that does not
nd factual information.

Under the 2014 WP and WT agreements, the initial certification period of the WP or WT
agreement is the period ending on the third full calendar year that the WP or WT agreement is
in effect, and subsequent certification periods are every three years following the initial
certification period (other than for a WP or WT that is a NFFE or a retirement fund that does not

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make a pooled reporting election under section 6.02(D) of the WP or WT agreement, in which
case subsequent certification periods are every six years for such NFFE or retirement fund). To
make the WP and WT agreements more administrable for the IRS, the WP and WT agreements
are revised to provide a three-year subsequent certification period for all WPs or WTs. In
addition, the WP and WT agreements are revised to clarify that the certification period under the
WP or WT agreement may not necessarily be the same as the certification period that applies to
the WP’s or WT’s FATCA requirements as a participating FFI or registered deemed-compliant
FFI. Therefore, a WP or WT may have a different review cycle and certification due date for the
certification required under its FATCA requirements than under the WP or WT agreement, and
should comply with the requirements for both. In the certification of internal controls in the
Appendix to the WP and WT agreements, a WP or WT must certify that it has maintained its
chapter 4 status during the certification period under the WP or WT agreement (not the WP’s or
WT’s certification period under its FATCA requirements, if any).

The 2017 QI agreement allows the use of statistical sampling of a QI’s accounts for
purposes of the periodic review for certain QIs, and includes a safe harbor method in Appendix
II of the QI agreement for determining a statistical sample of accounts for the periodic review
n period under the WP or WT agreement (not the WP’s or
WT’s certification period under its FATCA requirements, if any).

The 2017 QI agreement allows the use of statistical sampling of a QI’s accounts for
purposes of the periodic review for certain QIs, and includes a safe harbor method in Appendix
II of the QI agreement for determining a statistical sample of accounts for the periodic review.
Section 8.05 of the WP and WT agreements provide that a WP or WT that has more than 60
partners, beneficiaries, or owners for the year of the periodic review that are partners,
beneficiaries or owners for which the WP or WT acts as a WP or WT may use statistical
sampling procedures for its periodic review if the WP or WT applies the principles set forth in
Appendix II of the QI Agreement in Revenue Procedure 2017-15.

.02 Consolidated Compliance Program. In response to a comment to the 2014 WP
agreement, section 8.02(C) of the WP agreement provides an allowance for consolidated
periodic reviews and certifications for WPs, similar to the allowance for QIs. The WP agreement
provides an option for a consolidated compliance program to be managed by a Compliance
Entity. A Compliance Entity must implement a compliance program that includes uniform

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practices, procedures, and systems, subject to uniform monitoring and control, with respect to
all WPs in the consolidated compliance program for purposes of meeting the requirements of
section 8 of the WP agreement. The Compliance Entity must agree to be jointly and severally
liable for each WP’s obligations under its WP agreement. A WP in a consolidated compliance
program may not request a waiver of the periodic review requirement. The responsible officer
of the Compliance Entity must perform a consolidated periodic review described in sections 8.04
and 8.05 of the WP agreement that includes each WP in the consolidated compliance program
but is permitted to make one certification for all WPs in the program
agreement. A WP in a consolidated compliance
program may not request a waiver of the periodic review requirement. The responsible officer
of the Compliance Entity must perform a consolidated periodic review described in sections 8.04
and 8.05 of the WP agreement that includes each WP in the consolidated compliance program
but is permitted to make one certification for all WPs in the program. The responsible officer
may make the periodic certification of compliance on a consolidated basis for all WPs in the
program, but must complete submit the factual information described in Part IV of the Appendix
to the WP agreement separately for each WP. The Compliance Entity must be the sponsoring
entity for chapter 4 purposes for each WP in the consolidated compliance program unless the
IRS Foreign Intermediaries Program approves the use of a different entity.

A comment to Notice 2016-42 suggested that a consolidated compliance program for
WPs should not include a requirement that the program have “uniform” practices, procedures,
and systems because this may be interpreted to mean “identical” practices, procedures, and
systems. This comment is not adopted because the term “uniform” does not necessarily mean
identical, but can also mean “consistent in approach,” which is the intended meaning here.

.03 Foreign Reverse Hybrid Entities. The WP agreement is revised to include
requirements for a WP that is a foreign reverse hybrid entity. Previously, a foreign reverse
hybrid entity could only act as a WP if it obtained a rider that modified the terms of the WP
agreement. A foreign reverse hybrid entity is defined in section 2.31 of the WP agreement to
mean A “foreign reverse hybrid entity” means an entity organized or incorporated outside of the
United States that is treated as a corporation for U.S
ign reverse hybrid entity. Previously, a foreign reverse
hybrid entity could only act as a WP if it obtained a rider that modified the terms of the WP
agreement. A foreign reverse hybrid entity is defined in section 2.31 of the WP agreement to
mean A “foreign reverse hybrid entity” means an entity organized or incorporated outside of the
United States that is treated as a corporation for U.S. federal income tax purposes but is fiscally
transparent (within the meaning of §1.894-1(d)(3)(ii)) under the laws of the country in which it is
organized with respect to the items of income paid to the entity. A WP that is a foreign reverse

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hybrid entity may reduce the amount of withholding on an amount distributed to, or included in
the distributive share of, a partner that is eligible for treaty benefits, provided that the WP
obtains the documentation required under section 4.03 of the WP agreement. The WP
agreement only allows a foreign reverse hybrid entity to obtain reduced rates of withholding
under tax treaties for foreign interest holders, and requires the foreign reverse hybrid entity to
comply with U.S. reporting obligations under the passive foreign investment company (PFIC)
rules and chapter 4. Since a foreign reverse hybrid entity is treated as a corporation for U.S. tax
purposes, and therefore is not required to file a Form 1065 or Schedule K-1, section 6.03(C) of
the WP agreement does not require a WP that is a foreign reverse hybrid entity to file a Form
1065 or Schedule K-1, and instead the WP must prepare the reconciliation statement described
in section 6.03(C)(3) of the WP agreement to support the WP’s allocations of U.S. source FDAP
income to each partner that claims treaty benefits and issue the PFIC Annual Information
Statements described in section 6.03(C)(4) of the WP agreement The reconciliation statement
and the PFIC Annual Information Statements must be reviewed for accuracy as part of a WP’s
periodic review
nt described
in section 6.03(C)(3) of the WP agreement to support the WP’s allocations of U.S. source FDAP
income to each partner that claims treaty benefits and issue the PFIC Annual Information
Statements described in section 6.03(C)(4) of the WP agreement The reconciliation statement
and the PFIC Annual Information Statements must be reviewed for accuracy as part of a WP’s
periodic review.

.04 Additional Changes to Conform to the 2017 QI Agreement and the Temporary
Chapter 3 Regulations. The WP and WT agreements are updated consistent with the 2017 QI
agreement and the temporary chapter 3 regulations. For example, the WP and WT agreements
require a WP or WT to obtain information regarding limitation on benefits on a treaty statement
obtained from an entity that is a beneficial owner claiming treaty benefits. A transitional rule
permits a WP or WT to obtain the information on limitation on benefits for certain partners,
beneficiaries, or owners by January 1, 2019. In addition, section 6.02(B)(6) of the 2014 WP and
WT agreements, which required specific reporting of each partnership or trust to which the joint
account option is applied, is removed because section 9.01(B)(3) of the WP and WT
agreements permits a WP or WT to report amounts distributed to, or included in the distributive
share of, the partnership’s or trust’s direct partners, beneficiaries, or owners in chapter 3

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reporting pools on Form 1042-S. See the preamble to the 2017 QI agreement for additional
information on these changes.

.05 Changes to Conform to the Chapter 4 Temporary and Final Regulations. In section
2 of the WP and WT agreements, the definition of participating FFI is revised to cross-reference
§1.1471-1(b)(91) to incorporate the definition in the final chapter 4 regulations, and the definition
of U.S. person is updated to incorporate revisions to the definition in the chapter 4 final
regulations
nges.

.05 Changes to Conform to the Chapter 4 Temporary and Final Regulations. In section
2 of the WP and WT agreements, the definition of participating FFI is revised to cross-reference
§1.1471-1(b)(91) to incorporate the definition in the final chapter 4 regulations, and the definition
of U.S. person is updated to incorporate revisions to the definition in the chapter 4 final
regulations. Section 6.05(A)(2) of the WP agreement incorporates rules in the temporary
chapter 4 regulations regarding account reporting requirements for participating FFIs that are
partnerships. A WP that is a participating FFI or registered deemed-compliant FFI (other than a
reporting Model 1 FFI) reporting a U.S. account or an account held by an owner-documented
FFI on Form 8966 must report the partner’s distributive share of the partnership’s income or loss
for the calendar year, without regard to whether any such amount is distributed to the partner
during the year, and any guaranteed payments for the use of capital. The amount required to
be reported with respect to a partner may be determined based on the WP’s tax returns or, if the
tax returns are unavailable by the due date for filing Form 8966, the WP’s financial statements
or any other reasonable method used by the WP for calculating the partner’s share of
partnership income and loss by such date.

.06 Additional Changes and Corrections. The 2014 WP and WT agreements provide
that a WP or WT that is an FFI may obtain documentary evidence in accordance with the know-
your-customer (KYC) rules set forth in an attachment to the WP or WT agreement. The KYC
rules that have been approved for each jurisdiction are available at
http://www.irs.gov/Businesses/International-Businesses/List-of-Approved-KYC-Rules
l Changes and Corrections. The 2014 WP and WT agreements provide
that a WP or WT that is an FFI may obtain documentary evidence in accordance with the know-
your-customer (KYC) rules set forth in an attachment to the WP or WT agreement. The KYC
rules that have been approved for each jurisdiction are available at
http://www.irs.gov/Businesses/International-Businesses/List-of-Approved-KYC-Rules. Because
the KYC rules are readily accessible online, and because the IRS no longer provides signed
copies of a WP or WT agreement, the applicable KYC rules will no longer be attached to a WP
or WT agreement and references to an attachment to the WP or WT agreement are removed.

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The WP and WT agreements include revisions and corrections to several definitions in
section 2 of the WP or WT agreement. The definition of the term financial institution is revised
to correct a cross-reference and conform to the definition in §1.1471-1(b)(50). The definition of
the term foreign financial institution is revised to conform to the definition in §1.1471-1(b)(47).
Definitions are added for the terms nonqualified intermediary, nonreporting Model 1 FFI,
nonreporting Model 2 FFI, and (in the WP agreement only) foreign reverse hybrid entity. The
definition of the term certified deemed-compliant FFI is moved to section 2.08 of the WP or WT
agreement and revised to exclude registered deemed-compliant Model 1 IGA FFIs because
when the term certified deemed-compliant FFI was used in the 2014 WP and WT agreements,
registered deemed-compliant Model 1 IGA FFIs were excluded by a parenthetical. The
definition of the term registered deemed-compliant FFI is moved to section 2.63 of the WP
agreement and section 2.61 of the WT agreement and revised to exclude registered deemed-
compliant Model 1 IGA FFIs providing a chapter 4 withholding rate pool of U.S. payees
t FFI was used in the 2014 WP and WT agreements,
registered deemed-compliant Model 1 IGA FFIs were excluded by a parenthetical. The
definition of the term registered deemed-compliant FFI is moved to section 2.63 of the WP
agreement and section 2.61 of the WT agreement and revised to exclude registered deemed-
compliant Model 1 IGA FFIs providing a chapter 4 withholding rate pool of U.S. payees. The
inclusion of registered deemed-compliant Model 1 IGA FFIs in the definition of registered
deemed-compliant FFI is unnecessary because section 6.02(C) of the WP or WT agreement
already specifically identifies registered deemed-compliant Model 1 IGA FFIs as a category of
FFIs that may provide a U.S. payee pool. Finally, the definition of the term registered deemed-
compliant Model 1 IGA FFI is moved to section 2.64 of the WP agreement and section 2.62 of
the WT agreement.

In the 2014 WP and WT agreements, the term passthrough partner or passthrough
beneficiary or owner is defined as a direct or indirect partner, beneficiary, or owner of a WP or
WT that is a foreign intermediary or foreign flow-through entity. The term intermediary is
defined as any person that acts as a custodian, broker, nominee, or agent with respect to a
payment. However, a passthrough partner or passthrough beneficiary or owner should not
include a QI that assumes primary chapters 3 and 4 withholding responsibility with respect to
payments of U.S. source FDAP income or assumes primary Form 1099 reporting and backup
h entity. The term intermediary is
defined as any person that acts as a custodian, broker, nominee, or agent with respect to a
payment. However, a passthrough partner or passthrough beneficiary or owner should not
include a QI that assumes primary chapters 3 and 4 withholding responsibility with respect to
payments of U.S. source FDAP income or assumes primary Form 1099 reporting and backup

13

withholding responsibility. Therefore, the definition of passthrough partner, beneficiary, or
owner is corrected to include a qualified intermediary that does not assume primary chapters 3
and 4 withholding responsibility with respect to payments of U.S. source FDAP income or
primary Form 1099 reporting and backup withholding responsibility.

Section 3.03 of the WP and WT agreements provides the general rule for withholding on
amounts subject to chapter 3 withholding and withholdable payments distributed to, or included
in the distributive share of, a foreign partner, beneficiary, or owner. The 2014 WP and WT
agreements do not provide a rule for when to report withholding on a distributive share when the
withholding occurs after the due date (including extensions) of Forms 1042-S. Section 3.03 of
the WP and WT agreements is revised to provide that if the date that is the earlier of the due
date for filing Schedule K-1 (or the statement required under section 6048(b)) or the date that
the Schedule K-1 (or the statement required under section 6048(b)) is actually furnished to the
partner, beneficiary, or owner, is after the due date (including extensions) for filing the WP's or
WT’s Forms 1042-S for the calendar year, the WP or WT must withhold and report the
withholding on the distributive share that relates to the prior calendar year as if it arises in the
subsequent calendar year
dule K-1 (or the statement required under section 6048(b)) is actually furnished to the
partner, beneficiary, or owner, is after the due date (including extensions) for filing the WP's or
WT’s Forms 1042-S for the calendar year, the WP or WT must withhold and report the
withholding on the distributive share that relates to the prior calendar year as if it arises in the
subsequent calendar year.

Under section 3.04 of the WP or WT agreement, a WP or WT may determine the
amount of withholding on a distribution based on an estimate of a partner’s, beneficiary’s, or
owner’s distributive share of income, provided that the WP or WT corrects the withholding to
reflect the partner’s, beneficiary’s, or owner’s actual distributive share on the earlier of the due
date for filing Schedule K-1 (or the statement required under section 6048(b)) or the date that
the Schedule K-1 (or the statement required under section 6048(b)) is actually furnished to the
partner, beneficiary, or owner. Section 3.04 of the WP and WT agreements is revised to require
a WP or WT to report any corrections made after the earlier of the due date (including
extensions) of Forms 1042-S or the date that Forms 1042-S are actually issued on Form 1042-S
for the subsequent calendar year. This revision is made to ensure that a WP or WT that has

14

already issued Forms 1042-S reports the corrections for the subsequent year rather than
amending the prior year Forms 1042-S.

.07 Effective Date and Term of the WP and WT Agreements. In Revenue Procedure
2017-15, the Treasury Department and the IRS announced that because the updated WP and
WT agreements would not be published before December 31, 2016, WPs and WTs with
agreements in effect on December 31, 2016, may continue to treat those agreements as in
effect until updated agreements are issued.

Section 12.01(A) of the WP and WT agreements provides that, in general, the effective
date of a WP or WT agreement depends on when the WP or WT application is submitted
ted WP and
WT agreements would not be published before December 31, 2016, WPs and WTs with
agreements in effect on December 31, 2016, may continue to treat those agreements as in
effect until updated agreements are issued.

Section 12.01(A) of the WP and WT agreements provides that, in general, the effective
date of a WP or WT agreement depends on when the WP or WT application is submitted. If a
WP or WT applies on or before March 31 of the calendar year and is approved for WP or WT
status, the WP or WT agreement will be effective January 1 of such calendar year. If a WP or
WT applies after March 31 and is approved in the same calendar year and receives reportable
amounts between January 1 of the year in which the application is submitted and the date of
approval, the WP or WT agreement will be effective January 1 of the following calendar year. If
a WP or WT that applies after March 31 does not receive any reportable amounts between
January 1 of the year in which the application is submitted and the date of approval, the WP or
WT agreement will be effective on the date the WP or WT is issued a WP-EIN or WT-EIN.

A special rule for calendar year 2017 provides that if a WP or WT is approved for WP or
WT status during calendar year 2017, the rules described in section 12.01(A) of the WP or WT
agreement apply, except that the terms of the WP or WT agreement effective from January 1,
2017, to the date of issuance of this revenue procedure will be the terms in the WP or WT
agreement in Revenue Procedure 2014-47, and the terms of the WP or WT agreement provided
in this revenue procedure will apply beginning on the date of issuance of this revenue
procedure.

The WP and WT agreements in sections 6 and 7 of this revenue procedure expire upon
the earlier of the date the WP or WT terminates under its partnership agreement or trust
will be the terms in the WP or WT
agreement in Revenue Procedure 2014-47, and the terms of the WP or WT agreement provided
in this revenue procedure will apply beginning on the date of issuance of this revenue
procedure.

The WP and WT agreements in sections 6 and 7 of this revenue procedure expire upon
the earlier of the date the WP or WT terminates under its partnership agreement or trust

15

instrument (as applicable) or the end of the sixth full calendar year the WP or WT agreement is
in effect, unless the WP or WT agreement is terminated under section 10.02 or 10.03 of the WP
or WT agreement.
SECTION 5. APPLICATION PROCEDURES FOR WP OR WT AGREEMENTS

.01 Prospective WP or WT. An entity seeking to enter into a WP or WT agreement must
submit Form 14345, “Application for Qualified Intermediary, Withholding Foreign Partnership, or
Withholding Foreign Trust Status,” online through the QI/WP/WT Application and Account
Management System accessible through the QI/WP/WT landing page available at
https://www.irs.gov/businesses/corporations/qualified-intermediary-system. The application
must also include any additional information and documentation requested by the IRS. The
application must establish, to the satisfaction of the IRS, that the applicant has adequate
resources and has established appropriate practices and procedures to comply with the terms
of the WP agreement or WT agreement. Questions regarding WP and WT applications may be
sent to lbi.fi.qiwpissues@irs.gov.

Prior to submitting Form 14345, a prospective WP or WT (other than an FFI that is a
retirement fund or an NFFE that is not a sponsoring entity) must submit Form 8957, “Foreign
Account Tax Compliance Act (FATCA) Registration,” through the FATCA registration website
available at www.irs.gov/FATCA to obtain a chapter 4 status of participating FFI, registered
deemed-compliant FFI, registered deemed-compliant Model 1 IGA FFI, or sponsoring entity
or WT (other than an FFI that is a
retirement fund or an NFFE that is not a sponsoring entity) must submit Form 8957, “Foreign
Account Tax Compliance Act (FATCA) Registration,” through the FATCA registration website
available at www.irs.gov/FATCA to obtain a chapter 4 status of participating FFI, registered
deemed-compliant FFI, registered deemed-compliant Model 1 IGA FFI, or sponsoring entity.
Upon completion of the registration process, a WP or WT described in the preceding sentence
will be issued a GIIN (which is separate from its WP-EIN or WT-EIN) to be used to identify its
chapter 4 status to withholding agents and to tax administrators, if applicable, and for FATCA
reporting to the extent required under its FATCA requirements.

If the IRS approves the WP or WT application, the IRS will send the WP or WT an
approval notice and the WP-EIN or WT-EIN assigned to the entity for fulfilling the requirements
of a WP or WT under the WP or WT agreement. A WP or WT that has been issued a GIIN

16

must, within 90 days of the date of approval of its WP or WT application, update its FATCA
registration on the FATCA registration website to include its WP-EIN or WT-EIN.

The IRS will not enter into a WP or WT agreement with an FFI that provides for the use
of documentary evidence obtained under a jurisdiction's know-your-customer rules if it has not
approved that jurisdiction’s “know-your-customer” practices and procedures. A list of
jurisdictions with know-your-customer rules that the IRS has approved is available at
http://www.irs.gov/Businesses/International-Businesses/List-of-Approved-KYC-Rules. To
request IRS approval of a jurisdiction's know-your-customer rules, contact the KYC coordinator
in the IRS Foreign Intermediaries Program at lbi.fi.qiwpissues@irs.gov.

.02 Existing WP or WT
ces and procedures. A list of
jurisdictions with know-your-customer rules that the IRS has approved is available at
http://www.irs.gov/Businesses/International-Businesses/List-of-Approved-KYC-Rules. To
request IRS approval of a jurisdiction's know-your-customer rules, contact the KYC coordinator
in the IRS Foreign Intermediaries Program at lbi.fi.qiwpissues@irs.gov.

.02 Existing WP or WT. A WP or WT that has executed a WP or WT agreement and
seeks to renew its WP or WT agreement must do so online through the QI/WP/WT Application
and Account Management System and include the information requested for renewal of its WP
or WT status. A WP or WT will retain its previously issued WP-EIN or WT-EIN for fulfilling the
requirements of a WP or WT under chapters 3 and 4.
.03 Contact Information. For questions regarding the WP and WT application process,
contact the Foreign Intermediaries Program at lbi.fi.qiwpissues@irs.gov.
SECTION 6. Withholding Foreign Partnership Agreement
Section 1. PURPOSE AND SCOPE
Section 2. DEFINITIONS
Section 3. WITHHOLDING RESPONSIBILITY
Section 4. DOCUMENTATION REQUIREMENTS
Section 5. WITHHOLDING FOREIGN PARTNERSHIP WITHHOLDING CERTIFICATE
Section 6. TAX RETURN AND INFORMATION REPORTING OBLIGATIONS
Section 7. ADJUSTMENTS FOR OVER- AND UNDERWITHHOLDING; REFUNDS
Section 8. COMPLIANCE PROCEDURES
Section 9. CERTAIN PARTNERSHIPS AND TRUSTS AND INDIRECT PARTNERS
Section 10. EXPIRATION, TERMINATION AND DEFAULT
Section 11. MISCELLANEOUS PROVISIONS
TATION REQUIREMENTS
Section 5. WITHHOLDING FOREIGN PARTNERSHIP WITHHOLDING CERTIFICATE
Section 6. TAX RETURN AND INFORMATION REPORTING OBLIGATIONS
Section 7. ADJUSTMENTS FOR OVER- AND UNDERWITHHOLDING; REFUNDS
Section 8. COMPLIANCE PROCEDURES
Section 9. CERTAIN PARTNERSHIPS AND TRUSTS AND INDIRECT PARTNERS
Section 10. EXPIRATION, TERMINATION AND DEFAULT
Section 11. MISCELLANEOUS PROVISIONS

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Section 12. EFFECTIVE DATE OF AGREEMENT
The text of the WP agreement is set forth below. The IRS will not provide signed copies of the
WP agreement. A reporting Model 2 FFI should interpret this Agreement by substituting the
term “reporting Model 2 FFI” for “participating FFI” throughout this Agreement, except in cases
where this Agreement explicitly refers to a reporting Model 2 FFI. A reporting Model 1 FFI and a
nonreporting Model 2 FFI treated as a registered deemed-compliant FFI should apply this
Agreement by substituting the term “reporting Model 1 FFI” or “nonreporting Model 2 FFI,” as
applicable, for “registered deemed-compliant FFI” throughout this Agreement, except in cases
where this Agreement explicitly refers to a reporting Model 1 FFI or nonreporting Model 2 FFI
treated as a registered deemed-compliant FFI.
WHEREAS, WP has submitted an application in accordance with this revenue
procedure to be a withholding foreign partnership for purposes of §1.1441-5(c)(2);
WHEREAS, WP and the IRS desire to enter into an agreement to establish
WP's rights and obligations regarding documentation, withholding, information
reporting, tax return filing, deposits, and refund procedures under sections 1441,
1442, 1443, 1461, 1471, 1472, 1474, 6031, 6302, 6402, and 6414 with respect to
certain types of payments;
WHEREAS, WP represents that there are no legal restrictions that prohibit it
from complying with the requirements of this Agreement;
WHEREAS, if WP is a foreign financial institution (other than a retirement fund),
WP represents that it has agreed to comply with the requirements of the
1442, 1443, 1461, 1471, 1472, 1474, 6031, 6302, 6402, and 6414 with respect to
certain types of payments;
WHEREAS, WP represents that there are no legal restrictions that prohibit it
from complying with the requirements of this Agreement;
WHEREAS, if WP is a foreign financial institution (other than a retirement fund),
WP represents that it has agreed to comply with the requirements of the FFI
agreement, in the case of a participating FFI (including a reporting Model 2 FFI);
§1.1471-5(f)(1) or the applicable Model 2 IGA, in the case of a registered deemed-
compliant FFI (other than a reporting Model 1 FFI); or an applicable Model 1 IGA, in
the case of a reporting Model 1 FFI or a registered deemed-compliant Model 1 IGA
FFI beginning on the effective date of this Agreement;
NOW, THEREFORE, in consideration of the following terms, representations, and
conditions, the parties agree as follows:
Section 1. PURPOSE AND SCOPE
Sec. 1.01. General Obligations. When the IRS enters into a WP agreement with a foreign
person, that foreign person becomes a WP. Except as otherwise provided in this Agreement,
WP's obligations with respect to income distributed to, or included in the distributive shares of,
its partners are governed by the Internal Revenue Code and the regulations thereunder. WP
must act in its capacity as a withholding foreign partnership pursuant to this Agreement for
reportable amounts that are distributed to, or included in the distributive share of, WP’s direct
partners. Notwithstanding the preceding sentence, this Agreement only allows a foreign reverse
hybrid entity to obtain reduced rates of withholding under tax treaties for foreign interest holders,
and requires the foreign reverse hybrid entity to comply with U.S. reporting obligations under the
passive foreign investment company (PFIC) rules and chapter 4
he distributive share of, WP’s direct
partners. Notwithstanding the preceding sentence, this Agreement only allows a foreign reverse
hybrid entity to obtain reduced rates of withholding under tax treaties for foreign interest holders,
and requires the foreign reverse hybrid entity to comply with U.S. reporting obligations under the
passive foreign investment company (PFIC) rules and chapter 4. WP may also act as a
withholding foreign partnership for reportable amounts that are distributed to, or included in the
distributive share of, a partner, beneficiary, or owner of a passthrough partner (i.e., an indirect
partner of WP) if such indirect partner is not a U.S. non-exempt recipient. Notwithstanding the
preceding sentence, a WP may act as a withholding foreign partnership for an indirect partner
that is a U.S. non-exempt recipient if such partner is included in the passthrough partner’s
chapter 4 withholding rate pool (as defined in section 2.15 of this Agreement) of U.S. payees or
recalcitrant account holders provided on the FFI withholding statement (as defined in section
2.26 of this Agreement) of the passthrough partner.

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WP is not required to act as a withholding foreign partnership for payments that it distributes to,
or includes in the distributive share of, a passthrough partner or indirect partner. With respect to
an indirect partner for which WP does not (or cannot) act as a withholding foreign partnership,
WP must, as part of its WP agreement, comply with the requirements of a withholding agent, as
applicable to a nonwithholding foreign partnership under chapters 3 and 4. WP (regardless of
whether it is an FFI or NFFE) must also, pursuant to this Agreement, assume primary reporting
responsibility for purposes of section 1472
hich WP does not (or cannot) act as a withholding foreign partnership,
WP must, as part of its WP agreement, comply with the requirements of a withholding agent, as
applicable to a nonwithholding foreign partnership under chapters 3 and 4. WP (regardless of
whether it is an FFI or NFFE) must also, pursuant to this Agreement, assume primary reporting
responsibility for purposes of section 1472.
If WP is an FFI, the requirements WP has agreed to as a participating FFI, registered deemed-
compliant FFI, or registered deemed-compliant Model 1 IGA FFI apply in addition to the
requirements under this Agreement except to the extent specifically modified by this Agreement.
This Agreement references WP’s FATCA requirements when necessary to facilitate
coordination with a WP’s obligations under this Agreement with respect to its partners. A
participating FFI’s obligations are provided in the FFI agreement, a registered deemed-
compliant FFI’s (other than a reporting Model 1 FFI’s) obligations are provided in §1.1471-5(f)(1)
or the applicable Model 2 IGA, and the obligations of a reporting Model 1 FFI or a registered
deemed-compliant Model 1 IGA FFI are provided in the applicable Model 1 IGA.
If WP is an NFFE, WP must comply with the requirements of a withholding agent under sections
1471 and 1472, which are provided in this Agreement.
If a WP acts as a sponsoring entity on behalf of a sponsored FFI or sponsored direct reporting
NFFE, it must comply with the due diligence, withholding, reporting, and compliance
requirements of a sponsoring entity in addition to its requirements under this Agreement.
Sec. 1.02. Parties to the Agreement. This Agreement applies to WP and the IRS.
Section 2. DEFINITIONS
For purposes of this Agreement, unless otherwise specified in this Agreement, the terms listed
in this section 2 are defined herein
comply with the due diligence, withholding, reporting, and compliance
requirements of a sponsoring entity in addition to its requirements under this Agreement.
Sec. 1.02. Parties to the Agreement. This Agreement applies to WP and the IRS.
Section 2. DEFINITIONS
For purposes of this Agreement, unless otherwise specified in this Agreement, the terms listed
in this section 2 are defined herein. Any term not defined in this section has the same meaning
that it has under the Code, including the income tax regulations under the Code, any applicable
income tax treaty, or any applicable Model 1 IGA or Model 2 IGA with respect to WP’s FATCA
requirements as a participating FFI, registered deemed-compliant FFI, or registered deemed-
compliant Model 1 IGA FFI.
Sec. 2.01. Account. “Account” has the meaning given to that term in §1.1471-1(b)(1) with
respect to WP’s FATCA requirements.
Sec. 2.02. Account Holder. “Account Holder” has the meaning given to that term in §1.1471-
1(b)(2) with respect to WP’s FATCA requirements with respect to an account that it maintains
within the meaning of §1.1471-5(b)(5).
Sec. 2.03. Agreement. "Agreement" means this Agreement between WP and the IRS, the
Appendix to this Agreement and WP’s application to become a withholding foreign partnership.
The Appendix to this Agreement and WP's application are incorporated into this Agreement by
reference.
Sec. 2.04. Amount Subject to Chapter 3 Withholding. An "amount subject to chapter 3
withholding" is an amount described in §1.1441-2(a), regardless of whether such amount is
withheld upon.
Sec. 2.05. Amount Subject to Chapter 4 Withholding. An “amount subject to chapter 4
withholding” is a withholdable payment (as defined in section 2.81 of this Agreement) for which
withholding is required under chapter 4 or an amount for which withholding was otherwise
applied under chapter 4.
olding" is an amount described in §1.1441-2(a), regardless of whether such amount is
withheld upon.
Sec. 2.05. Amount Subject to Chapter 4 Withholding. An “amount subject to chapter 4
withholding” is a withholdable payment (as defined in section 2.81 of this Agreement) for which
withholding is required under chapter 4 or an amount for which withholding was otherwise
applied under chapter 4.

19

Sec. 2.06. Assuming Primary Withholding Responsibility. “Assuming primary withholding
responsibility” refers to when a WP assumes primary chapters 3 and 4 withholding responsibility
with respect to amounts subject to chapter 3 or 4 withholding under the terms of the WP
agreement. Generally, a WP assuming primary chapters 3 and 4 withholding responsibility
relieves the person who makes a payment to the WP from the responsibility to withhold. See
sections 3.03 and 3.04 of this Agreement for when WP is required to withhold under this
Agreement.
Sec. 2.07. Beneficial Owner. A “beneficial owner” has the meaning given to that term in
§1.1441-1(c)(6).
Sec. 2.08. Certified Deemed-Compliant FFI. “Certified deemed-compliant FFI” means an FFI
described in §1.1471-5(f)(2), and includes a nonreporting Model 1 FFI and a nonreporting Model
2 FFI that is treated as a certified deemed-compliant FFI.
Sec. 2.09. Chapter 3. Any reference to "chapter 3 of the Code" or “chapter 3” means sections
1441, 1442, 1443, 1461, 1463, and 1464.
Sec. 2.10. Chapter 3 Reporting Pool. A chapter 3 reporting pool means a reporting pool
described in section 6.02(D) of this Agreement.
Sec. 2.11. Chapter 3 Status. The term “chapter 3 status” refers to the attributes of a payee
(and a partner of WP for purposes of this Agreement) relevant for determining the rate of
withholding with respect to a payment made to the payee for purposes of chapter 3.
Sec. 2.12. Chapter 4. Any reference to “chapter 4 of the Code” or “chapter 4” means sections
1471, 1472, 1473, and 1474.
Sec. 2.13. Chapter 4 Reporting Pool
. The term “chapter 3 status” refers to the attributes of a payee
(and a partner of WP for purposes of this Agreement) relevant for determining the rate of
withholding with respect to a payment made to the payee for purposes of chapter 3.
Sec. 2.12. Chapter 4. Any reference to “chapter 4 of the Code” or “chapter 4” means sections
1471, 1472, 1473, and 1474.
Sec. 2.13. Chapter 4 Reporting Pool. A chapter 4 reporting pool means a reporting pool
described in section 6.02(C) of this Agreement.
Sec. 2.14. Chapter 4 Status. “Chapter 4 status” means the status of a person as a U.S. person,
specified U.S. person, an individual that is a foreign person, a participating FFI, a deemed-
compliant FFI, a restricted distributor, an exempt beneficial owner, a nonparticipating FFI, a
territory financial institution, an excepted NFFE, or a passive NFFE.
Sec. 2.15. Chapter 4 Withholding Rate Pool. A “chapter 4 withholding rate pool” means a
pool of payees that are nonparticipating FFIs provided on a chapter 4 withholding statement (as
described in §1.1471-3(c)(3)(iii)(B)(3)) to which a withholdable payment is allocated. The term
chapter 4 withholding rate pool also means a pool of payees provided on an FFI withholding
statement (as described in §1.1471-3(c)(3)(iii)(B)(2)) to which a withholdable payment is
allocated to --
(A) A pool of payees consisting of each class of recalcitrant account holders described in
§1.1471-4(d)(6) (or with respect to an FFI that is a QI, a single pool of recalcitrant account
holders that is not subdivided into classes of recalcitrant account holders described in §1.1471-
4(d)(6)), including a separate pool of account holders to which the escrow procedures for
dormant accounts apply; or
(B) A pool of payees that are U.S. persons as described in §1.1471-3(c)(3)(iii)(B)(2).
Sec. 2.16. Deemed-Compliant FFI
to an FFI that is a QI, a single pool of recalcitrant account
holders that is not subdivided into classes of recalcitrant account holders described in §1.1471-
4(d)(6)), including a separate pool of account holders to which the escrow procedures for
dormant accounts apply; or
(B) A pool of payees that are U.S. persons as described in §1.1471-3(c)(3)(iii)(B)(2).
Sec. 2.16. Deemed-Compliant FFI. “Deemed-compliant FFI” means a certified deemed-
compliant FFI, registered deemed-compliant FFI, or registered deemed-compliant Model 1 IGA
FFI that is treated, pursuant to section 1471(b)(2) and §1.1471-5(f), as meeting the
requirements of section 1471(b). For the definition of certified deemed-compliant FFI, see
section 2.08 of this Agreement. For the definition of registered deemed-compliant FFI, see

20

section 2.63 of this Agreement. For the definition of registered deemed-compliant Model 1 IGA
FFI, see section 2.64 of this Agreement.
Sec. 2.17. Direct Partner. A “direct partner” means a partner that is not an indirect partner (as
defined in section 2.40 of this Agreement).
Sec. 2.18. Documentary Evidence. “Documentary evidence” means any documentation
obtained under the appropriate know-your-customer rules (as defined in section 2.42 of this
Agreement), or any documentary evidence described in §1.1441-6 sufficient to establish
entitlement to a reduced rate of withholding under an income tax treaty. Documentary evidence
does not include a Form W-8 or Form W-9 (or an acceptable substitute Form W-8 or Form W-9).
Sec. 2.19. Documentation. “Documentation” means any valid Form W-8, Form W-9 (or
acceptable substitute Form W-8 or Form W-9), or documentary evidence, as defined in section
2.18 of this Agreement, including all statements or other information required to be associated
with the form or documentary evidence.
Sec. 2.20. Excepted NFFE. “Excepted NFFE” means a person described in §1.1471-1(b)(41).
Sec. 2.21. Exempt Beneficial Owner
ation” means any valid Form W-8, Form W-9 (or
acceptable substitute Form W-8 or Form W-9), or documentary evidence, as defined in section
2.18 of this Agreement, including all statements or other information required to be associated
with the form or documentary evidence.
Sec. 2.20. Excepted NFFE. “Excepted NFFE” means a person described in §1.1471-1(b)(41).
Sec. 2.21. Exempt Beneficial Owner. “Exempt beneficial owner” means a person described in
§1.1471-1(b)(42) and includes any person that is treated as an exempt beneficial owner under
an applicable Model 1 IGA or Model 2 IGA.
Sec. 2.22. Exempt Recipient. An “exempt recipient” means a person described in §1.6049-
4(c)(1)(ii) (for interest, dividends, and royalties), a person described in §1.6045-2(b)(2)(i) (for
broker proceeds), and a person described in §1.6041-3(q) (for rents, amounts paid on notional
principal contracts, and other fixed or determinable income), for which no Form 1099 reporting
is required. Exempt recipients are not exempt from reporting or withholding under chapter 3 or
4.
Sec. 2.23. FATCA Requirements as a Participating FFI, Registered Deemed-Compliant
FFI, or Registered Deemed-Compliant Model 1 IGA FFI. “FATCA requirements as a
participating FFI, registered deemed-compliant FFI, or registered deemed-compliant Model 1
IGA FFI” means:
(A) For a participating FFI, the requirements set forth in the FFI agreement;
(B) For a registered deemed-compliant FFI (other than a reporting Model 1 FFI), the
requirements under §1.1471-5(f)(1) or the applicable Model 2 IGA; or
(C) For a reporting Model 1 FFI and a registered deemed-compliant Model 1 IGA FFI, the
requirements under applicable foreign law to implement the applicable Model 1 IGA.
Sec. 2.24. Financial Institution (FI). “Financial institution” or “FI” has the meaning set forth in
§1.1471-5(e) and includes a financial institution as defined under an applicable Model 1 IGA or
Model 2 IGA.
Sec. 2.25. FFI Agreement
a reporting Model 1 FFI and a registered deemed-compliant Model 1 IGA FFI, the
requirements under applicable foreign law to implement the applicable Model 1 IGA.
Sec. 2.24. Financial Institution (FI). “Financial institution” or “FI” has the meaning set forth in
§1.1471-5(e) and includes a financial institution as defined under an applicable Model 1 IGA or
Model 2 IGA.
Sec. 2.25. FFI Agreement. “FFI agreement” means an agreement of a participating FFI
described in §1.1471-4(a) and published in Revenue Procedure 2014-38, 2014-29 I.R.B.132 (as
updated or superseded by any subsequent revenue procedure).
Sec. 2.26. FFI Withholding Statement. An “FFI withholding statement” means a withholding
statement provided by an FFI that meets the requirements of §1.1471-3(c)(3)(iii)(B)(1) and (2).
Sec. 2.27. Flow-Through Entity. A “flow-through entity” is a foreign partnership described in
§301.7701-2 or 3 (other than a withholding foreign partnership), a foreign trust that is described
in section 651(a) (other than a withholding foreign trust), or a foreign trust if all or a portion of
such trust is treated as owned by the grantor or other person under sections 671 through 679.

21

With respect to an item of U.S. source FDAP income for which a treaty benefit is claimed, an
entity is also a flow-through entity to the extent it is treated as fiscally transparent under section
894 and the regulations thereunder.
Sec. 2.28. Foreign Financial Institution (FFI). “Foreign financial institution” or “FFI” has the
meaning set forth in §1.1471-5(d).
Sec. 2.29. Foreign TIN. A “foreign TIN” is a taxpayer identification number issued by a foreign
person’s country of residence.
Sec. 2.30. Foreign Person. A "foreign person" is any person that is not a U.S. person and
includes a nonresident alien individual, a foreign corporation, a foreign partnership, a foreign
trust, and a foreign estate, as those terms are defined in section 7701 of the Code
c. 2.29. Foreign TIN. A “foreign TIN” is a taxpayer identification number issued by a foreign
person’s country of residence.
Sec. 2.30. Foreign Person. A "foreign person" is any person that is not a U.S. person and
includes a nonresident alien individual, a foreign corporation, a foreign partnership, a foreign
trust, and a foreign estate, as those terms are defined in section 7701 of the Code. For
purposes of chapters 3 and 4, the term “foreign person” also means, with respect to a payment
by a withholding agent, a foreign branch (including a foreign disregarded entity) of a U.S. person
that provides a valid Form W-8IMY on which it represents that it is a QI.
Sec. 2.31. Foreign Reverse Hybrid Entity. A “foreign reverse hybrid entity” means an entity
organized or incorporated outside of the United States that is treated as a corporation for U.S.
federal income tax purposes but is fiscally transparent (within the meaning of §1.894-1(d)(3)(ii))
under the laws of the country in which it is organized with respect to the items of income paid to
the entity.
Sec. 2.32. Form W-8. “Form W-8” means IRS Form W-8BEN, Certificate of Foreign Status of
Beneficial Owner for United States Tax Withholding (Individuals); IRS Form W-8BEN-E,
Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting
(Entities), IRS Form W-8ECI, Certificate of Foreign Person's Claim That Income is Effectively
Connected With the Conduct of a Trade or Business in the United States; IRS Form W-8EXP,
Certificate of Foreign Government or Other Foreign Organization for United States Tax
Withholding and Reporting; and IRS Form W-8IMY, Certificate of Foreign Intermediary, Foreign
Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding and
Reporting, as appropriate. It also includes any acceptable substitute Form W-8 described under
§§1.1441-1(e)(4)(vi) and 1.1471-3(c)(6)(v).
Sec. 2.33. Form W-9
ernment or Other Foreign Organization for United States Tax
Withholding and Reporting; and IRS Form W-8IMY, Certificate of Foreign Intermediary, Foreign
Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding and
Reporting, as appropriate. It also includes any acceptable substitute Form W-8 described under
§§1.1441-1(e)(4)(vi) and 1.1471-3(c)(6)(v).
Sec. 2.33. Form W-9. "Form W-9" means IRS Form W-9, Request for Taxpayer Identification
Number and Certification, or any acceptable substitute Form W-9 as described under
§31.3406(h)-3(c).
Sec. 2.34. Form 1042. "Form 1042" means IRS Form 1042, Annual Withholding Tax Return for
U.S. Source Income of Foreign Persons.
Sec. 2.35. Form 1042-S. "Form 1042-S" means IRS Form 1042-S, Foreign Person's U.S.
Source Income Subject to Withholding.
Sec. 2.36. Form 1065. "Form 1065" means IRS Form 1065, U.S. Return of Partnership Income,
including Schedules K-1 associated with that form.
Sec. 2.37. Form 1099. “Form 1099” means IRS Form 1099-B, Proceeds From Broker and
Barter Exchange Transactions; IRS Form 1099-DIV, Dividends and Distributions; IRS Form
1099-INT, Interest Income; IRS Form 1099-MISC, Miscellaneous Income; IRS Form 1099-OID,
Original Issue Discount; and any other form in the IRS Form 1099 series appropriate to the type
of payment required to be reported.
Sec. 2.38. Form 8966. “Form 8966” means IRS Form 8966, FATCA Report.
Sec. 2.39. Global Intermediary Identification Number (GIIN). “Global intermediary
identification number” or “GIIN” means the identification number that is assigned by the IRS to a
orm 1099-OID,
Original Issue Discount; and any other form in the IRS Form 1099 series appropriate to the type
of payment required to be reported.
Sec. 2.38. Form 8966. “Form 8966” means IRS Form 8966, FATCA Report.
Sec. 2.39. Global Intermediary Identification Number (GIIN). “Global intermediary
identification number” or “GIIN” means the identification number that is assigned by the IRS to a

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participating FFI, registered deemed-compliant FFI, direct reporting NFFE, or sponsoring entity.
The term also includes the identification number assigned by the IRS to a reporting Model 1 FFI
or registered deemed-compliant Model 1 IGA FFI for the purpose of identifying itself to
withholding agents.
Sec. 2.40. Indirect Partner. An “indirect partner” is a person that owns a partnership interest in
WP through one or more passthrough partners (as defined in section 2.56 of this Agreement).
For example, a person that holds an account with a foreign intermediary or an interest in a flow-
through entity which intermediary or flow-through entity, in turn, is a direct partner of WP is an
indirect partner. A person is an indirect partner of WP even if there are multiple tiers of
intermediaries or flow-through entities between the person and WP.
Sec. 2.41. Intermediary. An "intermediary" means a person that, for that payment, acts as a
custodian, broker, nominee, or otherwise as an agent for another person, regardless of whether
such other person is the beneficial owner of the amount paid, a flow-through entity, or another
intermediary.
Sec. 2.42. Know-Your-Customer Rules. “Know-your-customer rules” refers to the applicable
laws, regulations, rules, and administrative practices and procedures governing the
requirements of certain WPs that are FFIs to obtain documentation confirming the identity of
WP’s direct partners
ch other person is the beneficial owner of the amount paid, a flow-through entity, or another
intermediary.
Sec. 2.42. Know-Your-Customer Rules. “Know-your-customer rules” refers to the applicable
laws, regulations, rules, and administrative practices and procedures governing the
requirements of certain WPs that are FFIs to obtain documentation confirming the identity of
WP’s direct partners. A list of jurisdictions for which the IRS has received know-your-customer
information and for which the know-your-customer rules and specified documentation are
acceptable is available at: http://www.irs.gov/Businesses/International-Businesses/List-of-
Approved-KYC-Rules.
Sec. 2.43. Marketable Securities. For purposes of this Agreement, the term “marketable
securities” means those securities described in §1.1441-6 for which a U.S. TIN or foreign TIN is
not required to be provided by the beneficial owner to obtain treaty benefits.
Sec. 2.44. Non-Consenting U.S. Account. For purposes of a reporting Model 2 FFI, “non-
consenting U.S. account” has the meaning that such term has under the applicable Model 2
IGA.
Sec. 2.45. Non-Exempt Recipient. A “non-exempt recipient” means a person that is not an
exempt recipient under the definition in section 2.22 of this Agreement.
Sec. 2.46. Non-Financial Foreign Entity (NFFE). A “non-financial foreign entity” or “NFFE”
means a foreign entity that is not a financial institution (including an entity that is incorporated or
organized under the laws of any U.S. territory and that is not a financial institution). The term
also means a foreign entity treated as an NFFE pursuant to a Model 1 IGA or Model 2 IGA.
Sec. 2.47. Nonparticipating FFI. A “nonparticipating FFI” means an FFI other than a
participating FFI, a deemed-compliant FFI, or an exempt beneficial owner.
Sec. 2.48. Nonqualified Intermediary. A “nonqualified intermediary” is any intermediary that is
not a qualified intermediary
nstitution). The term
also means a foreign entity treated as an NFFE pursuant to a Model 1 IGA or Model 2 IGA.
Sec. 2.47. Nonparticipating FFI. A “nonparticipating FFI” means an FFI other than a
participating FFI, a deemed-compliant FFI, or an exempt beneficial owner.
Sec. 2.48. Nonqualified Intermediary. A “nonqualified intermediary” is any intermediary that is
not a qualified intermediary. A nonqualified intermediary includes any intermediary that is a
foreign person unless such person enters an agreement to be a qualified intermediary and acts
in such capacity. A nonqualified intermediary also includes an intermediary that is a territory
financial institution (as defined in §1.1471-1(b)(130)) unless such institution agrees to be treated
as a U.S. person.
Sec. 2.49. Nonreporting Model 1 FFI. A “nonreporting Model 1 FFI” means a nonreporting
financial institution described in Annex II of a Model 1 IGA.
Sec. 2.50. Nonreporting Model 2 FFI. A “nonreporting Model 2 FFI” means a nonreporting
financial institution described in Annex II of a Model 2 IGA.

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Sec. 2.51. Nonwithholding Foreign Partnership (NWP). A “nonwithholding foreign
partnership” means a foreign partnership other than a withholding foreign partnership, as
defined in §1.1441–5(c)(2).
Sec. 2.52. Nonwithholding Foreign Trust (NWT). A “nonwithholding foreign trust” means a
foreign trust (as defined in section 7701(a)(31)(B)) that is a foreign simple trust or a foreign
grantor trust and that is not a withholding foreign trust (as defined in section 2.85 of this
Agreement).
Sec. 2.53. Overwithholding
r than a withholding foreign partnership, as
defined in §1.1441–5(c)(2).
Sec. 2.52. Nonwithholding Foreign Trust (NWT). A “nonwithholding foreign trust” means a
foreign trust (as defined in section 7701(a)(31)(B)) that is a foreign simple trust or a foreign
grantor trust and that is not a withholding foreign trust (as defined in section 2.85 of this
Agreement).
Sec. 2.53. Overwithholding. The term "overwithholding" means any amount actually withheld
(determined before application of the adjustment procedures described in section 7.01 of this
Agreement) from an item of income or other payment that is in excess of:
(A) The amount required to be withheld under chapter 4 with respect to such item of income or
other payment, if applicable, and
(B) In the case of an amount subject to chapter 3 withholding, the actual tax liability of the
beneficial owner of the income or payment to which the withheld amount is attributable,
regardless of whether such overwithholding was in error or appeared correct at the time it
occurred. For purposes of section 3406, the term “overwithholding” means the excess of the
amount actually withheld under section 3406 over the amount required to be withheld.
Sec. 2.54. Participating FFI. A “participating FFI” is defined in §1.1471-1(b)(91).
Sec. 2.55. Partnership and Partner. The terms "partnership" and "partner" are defined in
section 7701(a)(2) of the Code and the regulations thereunder. For purposes of chapter 4,
“partner” means an account holder, as defined in section 2.02 of this Agreement, with respect to
a WP that is an FFI
o be withheld.
Sec. 2.54. Participating FFI. A “participating FFI” is defined in §1.1471-1(b)(91).
Sec. 2.55. Partnership and Partner. The terms "partnership" and "partner" are defined in
section 7701(a)(2) of the Code and the regulations thereunder. For purposes of chapter 4,
“partner” means an account holder, as defined in section 2.02 of this Agreement, with respect to
a WP that is an FFI. For purposes of a foreign reverse hybrid entity, the term “partner” includes
a foreign interest holder of a foreign reverse hybrid entity, when the foreign reverse hybrid entity
is treated as fiscally transparent under the tax laws of the interest holder’s country of residence
(within the meaning of §1.894-1(d)(3)(iii)) with respect to the item of income paid to the foreign
reverse hybrid entity, and the interest holder itself is not treated as fiscally transparent under the
tax laws of the interest holder’s country of residence.
Sec. 2.56. Passthrough Partner. A “passthrough partner” is a direct or indirect partner of WP
that is a nonqualified intermediary, a qualified intermediary that does not assume primary
chapters 3 and 4 withholding responsibility with respect to payments of U.S. source FDAP
income or primary Form 1099 reporting and backup withholding responsibility, or a flow-through
entity. As provided in section 2.27 of this Agreement, a withholding foreign partnership or
withholding foreign trust is not a flow-through entity and thus is not a passthrough partner.
Sec. 2.57. Payee. For purposes of chapter 3, a “payee” is defined in §1.1441-1(c)(12), and for
purposes of chapter 4, a “payee” means a person described in §1.1471-3(a).
Sec. 2.58. Payment. A "payment" means an amount considered made to a person if that
person realizes income whether or not such income results from an actual transfer of cash or
other property. See §1.1441-2(e).
Sec. 2.59. Payor
. 2.57. Payee. For purposes of chapter 3, a “payee” is defined in §1.1441-1(c)(12), and for
purposes of chapter 4, a “payee” means a person described in §1.1471-3(a).
Sec. 2.58. Payment. A "payment" means an amount considered made to a person if that
person realizes income whether or not such income results from an actual transfer of cash or
other property. See §1.1441-2(e).
Sec. 2.59. Payor. A “payor” is defined in §31.3406(a)-2 and §1.6049-4(a)(2) and generally
means any person required to make an information return under chapter 61.
Sec. 2.60. Pooled Reporting (PR) Election. A "pooled reporting election" or “PR election” is an
election to pool report chapter 3 reporting pools on Form 1042-S for chapter 3 purposes as
described in section 6.02(D) of this Agreement.
Sec. 2.61. Qualified Intermediary (QI). A “qualified intermediary” or “QI” is a person (or
branch) described in §1.1441-1(e)(5)(ii) that has in effect an agreement with the IRS to be

24

treated as a QI and acts as a QI. See Rev. Proc. 2017-15, 2017-03 I.R.B. 437 (as updated or
superseded by any subsequent revenue procedure), for the QI Agreement.
Sec. 2.62. Recalcitrant Account Holder. A “recalcitrant account holder” means a person
described in §1.1471-5(g).
Sec. 2.63. Registered Deemed-Compliant FFI. “Registered deemed-compliant FFI” means an
FFI described in §1.1471-5(f)(1) and includes a reporting Model 1 FFI and a nonreporting Model
2 FFI that is treated as a registered deemed-compliant FFI.
Sec. 2.64. Registered Deemed-Compliant Model 1 IGA FFI. “Registered deemed-compliant
Model 1 IGA FFI” means an FFI treated as a deemed-compliant FFI under an applicable Model
1 IGA that is subject to similar due diligence and reporting requirements with respect to U.S.
accounts as those applicable to a registered deemed-compliant FFI under §1.1471-5(f)(1),
including the requirement to register with the IRS.
Sec. 2.65. Reportable Amount. A “reportable amount” means U.S
pliant
Model 1 IGA FFI” means an FFI treated as a deemed-compliant FFI under an applicable Model
1 IGA that is subject to similar due diligence and reporting requirements with respect to U.S.
accounts as those applicable to a registered deemed-compliant FFI under §1.1471-5(f)(1),
including the requirement to register with the IRS.
Sec. 2.65. Reportable Amount. A “reportable amount” means U.S. source FDAP income that
is an amount subject to chapter 3 withholding (as defined in section 2.04 of this Agreement),
U.S. source deposit interest (as defined in section 871(i)(2)(A)), and U.S. source interest or
original issue discount paid on the redemption of short-term obligations (as defined in section
871(g)(1)(B)(i)). The term does not include payments on deposits with banks and other financial
institutions that remain on deposit for two weeks or less. It also does not include amounts of
original issue discount arising from a sale and repurchase transaction completed within a period
of two weeks or less, or amounts described in §1.6049-5(b)(7), (10), or (11) (relating to certain
foreign targeted registered obligations and certain obligations issued in bearer form).
Sec. 2.66. Reporting Model 1 FFI. A “reporting Model 1 FFI” means an FFI with respect to
which a foreign government or agency thereof agrees to obtain and exchange information
pursuant to a Model 1 IGA, other than an FFI that is treated as a nonreporting Model 1 FFI
(including a registered deemed-compliant Model 1 IGA FFI) or nonparticipating FFI under an
applicable Model 1 IGA.
Sec. 2.67. Reporting Pool. A “reporting pool” is defined in section 6.02(A) of this Agreement.
Sec. 2.68. Responsible Officer
ent or agency thereof agrees to obtain and exchange information
pursuant to a Model 1 IGA, other than an FFI that is treated as a nonreporting Model 1 FFI
(including a registered deemed-compliant Model 1 IGA FFI) or nonparticipating FFI under an
applicable Model 1 IGA.
Sec. 2.67. Reporting Pool. A “reporting pool” is defined in section 6.02(A) of this Agreement.
Sec. 2.68. Responsible Officer. A “responsible officer” of a WP means a partner of WP or an
officer or agent of the general partner of WP with sufficient authority to fulfill the duties of a
responsible officer as described in section 8 of this Agreement, including the requirements to
periodically certify and to respond to requests by the IRS for additional information to review
WP’s compliance with this Agreement.
Sec. 2.69. Retirement Fund. A “retirement fund” means a retirement fund or other fund that is
an exempt beneficial owner described in §1.1471-6(f) or a similar fund that qualifies as an
exempt beneficial owner under an applicable Model 1 IGA or Model 2 IGA.
Sec. 2.70. Schedule K-1. "Schedule K-1" or "K-1" is a schedule associated with Form 1065 that
shows each partner's separate share of partnership’s income, credits, deductions, etc.
Sec. 2.71. Sponsored Direct Reporting NFFE. The term “sponsored direct reporting NFFE”
has the meaning set forth in §1.1472-1(c)(5).
Sec. 2.72. Sponsored FFI. The term “sponsored FFI” means any entity described in §1.1471-
5(f)(1)(i)(F) (sponsored investment entities and sponsored controlled foreign corporations) or
§1.1471-5(f)(2)(iii) (sponsored, closely held investment vehicles).
Sec. 2.73. Sponsoring Entity. “Sponsoring entity” means (i) an entity that registers with the
IRS and agrees to perform the due diligence, withholding, and reporting obligations of one or
more sponsored FFIs pursuant to §1.1471-5(f)(1)(i)(F) or (f)(2)(iii); or (ii) an entity that registers
controlled foreign corporations) or
§1.1471-5(f)(2)(iii) (sponsored, closely held investment vehicles).
Sec. 2.73. Sponsoring Entity. “Sponsoring entity” means (i) an entity that registers with the
IRS and agrees to perform the due diligence, withholding, and reporting obligations of one or
more sponsored FFIs pursuant to §1.1471-5(f)(1)(i)(F) or (f)(2)(iii); or (ii) an entity that registers

25

with the IRS and agrees to perform the due diligence and reporting obligations of one or more
direct reporting NFFEs pursuant to §1.1472-1(c)(5).
Sec. 2.74. Underwithholding. "Underwithholding" means the excess of the amount required to
be withheld under chapter 3 or 4 over the amount actually withheld.
Sec. 2.75. Undocumented Partner. An “undocumented partner” is a partner for whom WP
does not have valid documentation.
Sec. 2.76. U.S. Account. A “U.S. account” is any financial account maintained by a
participating FFI or registered deemed-compliant FFI that is held by one or more specified U.S.
persons or U.S. owned foreign entities that such FFI reports or elects to report under the FFI
agreement or § 1.1471-5(f), as applicable. A U.S. account includes, in the case of a reporting
Model 1 FFI or registered deemed-compliant Model 1 IGA FFI, a U.S. reportable account as
defined in section 2.78 of this Agreement.
Sec. 2.77. U.S. Person. A "United States person" (or “U.S. person”) is a person described in
section 7701(a)(30), the U.S. government (including an agency or instrumentality thereof), a
State of the United States (including an agency or instrumentality thereof), or the District of
Columbia (including an agency or instrumentality thereof). An individual will not be treated as a
U.S. person for purposes of this Agreement for a taxable year or any portion of a taxable year
that the individual is a dual resident taxpayer (within the meaning of §301.7701(b)-7(a)(1)) who
is treated as a nonresident alien pursuant to §301.7701(b)-7 for purposes of computing the
individual’s U.S
olumbia (including an agency or instrumentality thereof). An individual will not be treated as a
U.S. person for purposes of this Agreement for a taxable year or any portion of a taxable year
that the individual is a dual resident taxpayer (within the meaning of §301.7701(b)-7(a)(1)) who
is treated as a nonresident alien pursuant to §301.7701(b)-7 for purposes of computing the
individual’s U.S. tax liability. A U.S. person does not include an alien individual who has made
an election under section 6013(g) or (h) to be treated as a resident of the United States. For
chapter 4 purposes, the term “U.S. person” or “United States person” also means a foreign
insurance company that has made an election under section 953(d), provided that either the
foreign insurance company is not a specified insurance company (as described in §1.1471-
5(e)(1)(iv)), or the foreign insurance company is a specified insurance company and is licensed
to do business in any State of the United States.
Sec. 2.78. U.S. Reportable Account. A “U.S. reportable account” means a financial account
maintained by a reporting Model 1 FFI or registered deemed-compliant Model 1 IGA FFI that
such FFI reports or elects to report under the applicable domestic law for compliance with and
implementation of FATCA.
Sec. 2.79. U.S. Source FDAP. “U.S. source FDAP” means amounts from sources within the
United States that constitute fixed or determinable annual or periodical income, as defined in
§1.1441-2(b)(1).
Sec. 2.80. U.S. TIN. A "U.S. TIN" means a U.S. taxpayer identification number assigned under
section 6109.
Sec. 2.81. Withholdable Payment. A “withholdable payment” means an amount described in
§1.1473-1(a).
Sec. 2.82. Withholding Agent. A "withholding agent" has the same meaning as set forth in
§1.1441-7(a) for purposes of chapter 3 and as set forth in §1.1473-1(d) for purposes of chapter
4 and includes a payor (as defined in section 2.59 of this Agreement).
Sec. 2.83. Withholding Foreign Partnership (WP)
Withholdable Payment. A “withholdable payment” means an amount described in
§1.1473-1(a).
Sec. 2.82. Withholding Agent. A "withholding agent" has the same meaning as set forth in
§1.1441-7(a) for purposes of chapter 3 and as set forth in §1.1473-1(d) for purposes of chapter
4 and includes a payor (as defined in section 2.59 of this Agreement).
Sec. 2.83. Withholding Foreign Partnership (WP). A "withholding foreign partnership" or “WP”
means a partnership, described in §1.1441-5(c)(2), that has in effect a withholding agreement
with the IRS to be treated as a withholding foreign partnership.
Sec. 2.84. WP-EIN. A "WP-EIN" means the employer identification number assigned by the IRS
to a withholding foreign partnership. WP's WP-EIN is only to be used when WP is acting as a
WP. For example, WP must give a withholding agent its EIN (other than its WP-EIN), if any, if it

26

is not acting as a WP (i.e., acting as a nonwithholding foreign partnership) and a taxpayer
identification number is required.
Sec. 2.85. Withholding Foreign Trust (WT). A “withholding foreign trust” or “WT” means a
trust, described in §1.1441-5(e)(5)(v), that has in effect a withholding agreement with the IRS to
be treated as a withholding foreign trust.
Section 3. WITHHOLDING RESPONSIBILITY
Sec. 3.01. Chapters 3 and 4 Withholding--In General.
(A) Chapter 4 Withholding.
WP (unless WP is a retirement fund) is a withholding agent for purposes of chapter 4 and is
subject to the withholding and reporting provisions applicable to withholding agents under
sections 1471 and 1472 with respect to its partners
reated as a withholding foreign trust.
Section 3. WITHHOLDING RESPONSIBILITY
Sec. 3.01. Chapters 3 and 4 Withholding--In General.
(A) Chapter 4 Withholding.
WP (unless WP is a retirement fund) is a withholding agent for purposes of chapter 4 and is
subject to the withholding and reporting provisions applicable to withholding agents under
sections 1471 and 1472 with respect to its partners. WP is required to withhold 30 percent of
any withholdable payment made after June 30, 2014, that is distributed to, or included in the
distributive share of, a partner that is an FFI unless WP can reliably associate the payment (or
portion of the payment) with documentation upon which it is permitted to rely to treat the
payment as exempt from withholding under §1.1471-2(a)(4), or the payment is made under a
grandfathered obligation described in §1.1471-2(b). See §1.1473-1(a) for the definition of a
withholdable payment and the applicable exceptions to this definition. WP is also required to
withhold 30 percent of any withholdable payment made after June 30, 2014, that is distributed
to, or included in the distributive share of, a partner that is an NFFE unless WP can reliably
associate the payment (or portion of the payment) with a certification described in §1.1472-
1(b)(1)(ii), or an exception to withholding under §1.1472-1 applies.
If WP is a retirement fund, WP is not required to withhold under section 1471 or 1472. If WP is
a participating FFI or registered deemed-compliant FFI (other than a reporting Model 1 FFI), WP
will satisfy its requirement to withhold under sections 1471(a) and 1472(a) with respect to direct
partners that are entities by withholding on withholdable payments made to nonparticipating
FFIs and recalcitrant account holders to the extent required under its FATCA requirements as a
participating FFI or registered deemed-compliant FFI
ed-compliant FFI (other than a reporting Model 1 FFI), WP
will satisfy its requirement to withhold under sections 1471(a) and 1472(a) with respect to direct
partners that are entities by withholding on withholdable payments made to nonparticipating
FFIs and recalcitrant account holders to the extent required under its FATCA requirements as a
participating FFI or registered deemed-compliant FFI. See the FFI agreement, §1.1471-5(f), or
the applicable Model 2 IGA for the withholding requirements that apply to withholdable
payments made to direct partners that are individuals and are treated as recalcitrant account
holders. If WP is a reporting Model 1 FFI or a registered deemed-compliant Model 1 IGA FFI,
WP will satisfy its requirement to withhold under section 1471(a) with respect to direct partners
by withholding on withholdable payments made to nonparticipating FFIs to the extent required
under its FATCA requirements as a registered deemed-compliant FFI or registered deemed-
compliant Model 1 IGA FFI. WP must withhold at the time and in the manner described in
sections 3.02 through 3.04 of this Agreement, which modifies other provisions describing the
time and manner in which WP would otherwise be required to withhold for chapter 4 purposes.
(B) Chapter 3 Withholding.
WP is a withholding agent for purposes of chapter 3 and is subject to the withholding and
reporting provisions applicable to withholding agents under chapter 3. WP must withhold 30
percent of any payment of an amount subject to chapter 3 withholding that is distributed to, or
included in the distributive share of, a partner that is a foreign person unless WP can reliably
associate the payment with documentation upon which it can rely to treat the payment as made
to a payee that is a U.S. person or as made to a beneficial owner that is a foreign person
entitled to a reduced rate of withholding
of an amount subject to chapter 3 withholding that is distributed to, or
included in the distributive share of, a partner that is a foreign person unless WP can reliably
associate the payment with documentation upon which it can rely to treat the payment as made
to a payee that is a U.S. person or as made to a beneficial owner that is a foreign person
entitled to a reduced rate of withholding. See section 4 of this Agreement regarding
documentation requirements applicable to WP for determining whether chapter 3 withholding
applies.

27

With respect to an amount subject to chapter 4 withholding that is also an amount subject to
chapter 3 withholding, WP may credit any tax withheld under chapter 4 against its liability for
any tax due under chapter 3 with respect to the payment so that no additional withholding is
required on the payment for purposes of chapter 3. Nothing in chapter 4 or the regulations
thereunder (including the FFI agreement) or any applicable IGA relieves WP of its requirements
to withhold on an amount subject to chapter 3 withholding to the extent required under sections
3.02 through 3.04 of this Agreement or modifies the documentation upon which WP may rely
under section 4 of this Agreement for determining whether withholding under chapter 3 applies.
Sec. 3.02. Primary Chapters 3 and 4 Withholding Responsibility. WP must assume primary
chapters 3 and 4 withholding responsibility for all withholdable payments and amounts subject
to chapter 3 withholding that are distributed to, or included in the distributive share of, any direct
partner and any indirect partner for which it acts as a WP to the extent permissible under
section 9 of this Agreement. If WP acts as a nonwithholding foreign partnership (NWP) with
respect to an indirect partner, it cannot assume primary chapters 3 and 4 withholding
responsibility for payments made to that indirect partner
distributed to, or included in the distributive share of, any direct
partner and any indirect partner for which it acts as a WP to the extent permissible under
section 9 of this Agreement. If WP acts as a nonwithholding foreign partnership (NWP) with
respect to an indirect partner, it cannot assume primary chapters 3 and 4 withholding
responsibility for payments made to that indirect partner. WP is not required to withhold on
amounts it pays to a QI that assumes primary withholding responsibility with respect to the
payment, or to a WT, or another WP.
If WP is a participating FFI or a registered deemed-compliant FFI, it may not elect with respect
to its direct partners to satisfy its obligation to withhold under chapter 4 (or the FFI agreement)
on a withholdable payment made to a recalcitrant account holder that is a U.S. non-exempt
recipient by backup withholding under section 3406 as provided in §1.1471-4(b)(3)(iii) and
section 4 of the FFI agreement.
See section 6 of this Agreement regarding WP's responsibility to report amounts subject to
withholding on Form 1042-S.
Sec. 3.03. Timing of Withholding. WP must withhold on the date it makes a distribution to a
foreign partner that includes a withholdable payment or an amount subject to chapter 3
withholding as determined under section 3.04 of this Agreement. To the extent a partner's
distributive share of income subject to withholding has not actually been distributed to the
partner, WP must withhold on the partner's distributive share on the earlier of the date that the
statement required under section 6031(b) (i.e., Schedule K-1) is mailed or otherwise provided to
the partner or the due date (including extensions) for furnishing the statement (whether or not
WP is required to prepare and furnish the statement)
withholding has not actually been distributed to the
partner, WP must withhold on the partner's distributive share on the earlier of the date that the
statement required under section 6031(b) (i.e., Schedule K-1) is mailed or otherwise provided to
the partner or the due date (including extensions) for furnishing the statement (whether or not
WP is required to prepare and furnish the statement). If that date is after the due date (including
extensions) for filing WP's Forms 1042-S for the calendar year to which the distributive share
relates, WP must withhold and report the withholding on the distributive share that relates to the
prior calendar year as if it arises in the subsequent calendar year. See section 6.01 of this
Agreement for requirements to report the withheld tax.
Sec. 3.04. Withholding on Distributions. WP may determine the amount of withholding on a
distribution based on a reasonable estimate of the partner's distributive share of income subject
to withholding for the year. WP must correct the estimated withholding to reflect the partner's
actual distributive share on the earlier of the date that the statement required under section
6031(b) (i.e., Schedule K-1) is mailed or otherwise provided to the partner or the due date
(including extensions) for furnishing the statement (whether or not WP is required to prepare
and furnish the statement). If that date is after the earlier of the due date (including extensions)
for filing WP's Forms 1042-S or the date WP actually issues Forms 1042-S for the calendar
year, WP must withhold and report any adjustments required by correcting the information for
the following calendar year.
Sec. 3.05. Deposit Requirements. WP must deposit amounts withheld under chapters 3 and 4
at the time and in the manner provided under section 6302 (see §1.6302-2(a) or §31.6302-1(h)).
for filing WP's Forms 1042-S or the date WP actually issues Forms 1042-S for the calendar
year, WP must withhold and report any adjustments required by correcting the information for
the following calendar year.
Sec. 3.05. Deposit Requirements. WP must deposit amounts withheld under chapters 3 and 4
at the time and in the manner provided under section 6302 (see §1.6302-2(a) or §31.6302-1(h)).

28

Section 4. DOCUMENTATION REQUIREMENTS
Sec. 4.01. Documentation Requirements.
(A) General Documentation Requirements. Except as otherwise provided in this section 4, WP
must obtain a Form W-8 or Form W-9 from every direct partner that receives a distribution or
distributive share of a reportable amount. If WP is an FFI and is subject to the know-your-
customer rules for documenting its partners (or subset of partners), WP may obtain
documentary evidence as set forth in the “know-your-customer” rules approved by the IRS (or
the documentation described in section 4.03(A)(3) of this Agreement) for the applicable
jurisdiction from its direct partners rather than a Form W-8 or Form W-9, provided WP adheres
to the know-your-customer rules that apply to WP with respect to the direct partner from whom
the documentary evidence is obtained.
WP must review and maintain documentation in accordance with this section 4 and, in the case
of documentary evidence obtained from direct partners, in accordance with the know-your-
customer rules approved by the IRS for the applicable jurisdiction. WP must make
documentation (together with any associated withholding statements and other documents or
information) available upon request for inspection by WP's external reviewer, if the performance
of an external review is requested by the IRS (as described in section 8.07(D) of this
Agreement). WP represents that none of the laws to which it is subject prohibits disclosure of
the identity of any partner or corresponding partner information to WP's reviewer
g statements and other documents or
information) available upon request for inspection by WP's external reviewer, if the performance
of an external review is requested by the IRS (as described in section 8.07(D) of this
Agreement). WP represents that none of the laws to which it is subject prohibits disclosure of
the identity of any partner or corresponding partner information to WP's reviewer.
(B) Coordination of Chapter 3 and Chapter 4 Documentation Requirements. If WP is an FFI
(other than a retirement fund), WP is required to perform the due diligence procedures under its
FATCA requirements as a participating FFI, registered deemed-compliant FFI, or registered
deemed-compliant Model 1 IGA FFI for each direct partner to determine if the partner is a holder
of a U.S. account (or U.S. reportable account), and to determine each direct partner that is a
nonparticipating FFI and, if applicable, that is a recalcitrant account holder (or non-consenting
U.S. account). See, however, the automatic termination provision of section 10.03(A) of this
Agreement if WP is not in possession of valid documentation for any direct partner at any time
that withholding or reporting is required. For purposes of this section 4, with respect to
documenting a partner for chapter 4 purposes, documentary evidence also includes
documentation or information that is publicly available to determine the chapter 4 status of the
account holder to the extent permitted under an applicable IGA.
If WP is an NFFE, WP is required to document the chapter 4 status of each partner to determine
if reporting or withholding applies under section 1471 or 1472 on withholdable payments
distributed to, or included in the distributive share of, the partner under the requirements of
§1.1471-3(d).
If WP has determined that withholding is not required under chapter 4, WP must obtain, unless
already collected, documentation that meets the requirements of this section 4 to determine
whether withholding applies under chapter 3
es under section 1471 or 1472 on withholdable payments
distributed to, or included in the distributive share of, the partner under the requirements of
§1.1471-3(d).
If WP has determined that withholding is not required under chapter 4, WP must obtain, unless
already collected, documentation that meets the requirements of this section 4 to determine
whether withholding applies under chapter 3. See also WP’s FATCA requirements as a
participating FFI, registered deemed-compliant FFI, or registered deemed-compliant Model 1
IGA FFI for when WP will have reason to know that a claim of chapter 4 status is unreliable or
incorrect and for WP’s requirements following a change in circumstances. If WP is an NFFE,
see §1.1471-3(e)(4) for when WP will have reason to know that an entity’s claim of chapter 4
status is unreliable or incorrect and §1.1471-3(c)(6)(ii)(E) for WP’s requirements following a
change in circumstances.
Sec. 4.02. Documentation for Foreign Partners. WP may treat a partner as a foreign
beneficial owner of an amount if the partner provides a valid Form W-8 (other than Form W-
8IMY), or valid documentary evidence, to the extent permitted under section 4.01(A) of this

29

Agreement, that supports the partner’s status as a foreign person. WP may treat a partner that
has provided documentation as entitled to a reduced rate of withholding under chapter 3 if all
the requirements for a reduced rate are met and the documentation provided by the partner
supports entitlement to a reduced rate of withholding and no withholding under chapter 4.
Sections 4.03 through 4.06 of this Agreement describe the specific documentation requirements
necessary for obtaining a reduced rate of withholding in certain circumstances.
Sec. 4.03. Treaty Claims
apter 3 if all
the requirements for a reduced rate are met and the documentation provided by the partner
supports entitlement to a reduced rate of withholding and no withholding under chapter 4.
Sections 4.03 through 4.06 of this Agreement describe the specific documentation requirements
necessary for obtaining a reduced rate of withholding in certain circumstances.
Sec. 4.03. Treaty Claims. WP may not reduce the rate of withholding under chapter 3 based on
a partner's claim of treaty benefits unless WP has determined that no chapter 4 withholding is
required and it obtains from the partner the documentation required by section 4.03(A) of this
Agreement. In addition, WP agrees to establish procedures to inform partners of the terms of
the limitation on benefits provisions of a treaty (if applicable, and regardless of whether those
provisions are contained in a separate article entitled Limitation on Benefits) under which the
partner is claiming benefits. For partners that are entities documented by WP on or after
January 1, 2017, WP is required to obtain a Form W-8BEN-E with the appropriate limitation on
benefits certification or, if WP is allowed to and obtains documentary evidence, the written
certification included in the treaty statement as described in section 4.03(B) of this Agreement.
For partners that are entities that were documented with documentary evidence prior to January
1, 2017, and for which treaty benefits are being claimed, WP is required to obtain the
appropriate limitation on benefits statement prior to January 1, 2019.
(A) Treaty Documentation. The documentation required by this section 4.03(A) is as follows:
s described in section 4.03(B) of this Agreement.
For partners that are entities that were documented with documentary evidence prior to January
1, 2017, and for which treaty benefits are being claimed, WP is required to obtain the
appropriate limitation on benefits statement prior to January 1, 2019.
(A) Treaty Documentation. The documentation required by this section 4.03(A) is as follows:
(1) A Form W-8BEN or Form W-8BEN-E on which a claim of treaty benefits is made, including,
for an entity, the appropriate limitation on benefits and section 894 certifications, as provided in
§1.1441-6(b)(1) (if applicable), and a U.S. TIN or foreign TIN. A U.S. TIN or foreign TIN shall not
be required, however, if the partner is a direct partner. If WP is acting as a withholding foreign
partnership for an indirect partner, the indirect partner is required to have either a U.S. TIN or a
foreign TIN in order to claim treaty benefits unless it is claiming treaty benefits on income from
marketable securities as described in §1.1441-6(c);
(2) Documentary evidence, as permitted under section 4.01(A) of this Agreement, that has been
obtained pursuant to the know-your-customer rules that apply to the direct partner, and the
direct partner, if it is an entity, has made the treaty statement (if applicable) required by section
4.03(B) of this Agreement; or
(3) The type of documentary evidence, as permitted under section 4.01(A) of this Agreement,
required under §1.1441-6 to establish entitlement to a reduced rate of withholding under a
treaty, and the direct partner, if it is an entity, has made the treaty statement (if applicable)
required by section 4.03(B) of this Agreement.
(B) Treaty Statement
ired by section
4.03(B) of this Agreement; or
(3) The type of documentary evidence, as permitted under section 4.01(A) of this Agreement,
required under §1.1441-6 to establish entitlement to a reduced rate of withholding under a
treaty, and the direct partner, if it is an entity, has made the treaty statement (if applicable)
required by section 4.03(B) of this Agreement.
(B) Treaty Statement. The treaty statement required by an entity direct partner under this
section 4.03(B) is as follows: [Name of Direct Partner] meets all provisions of the treaty that are
necessary to claim a reduced rate of withholding, including any applicable limitation on benefits
provisions, and derives the income within the meaning of section 894, and the regulations
thereunder, as the beneficial owner.
WP is only required to obtain the treaty statement described in this section 4.03(B) from a
partner that is an entity. WP shall not be required to obtain a treaty statement described in this
section 4.03(B) from an individual who is a resident of an applicable treaty country or from the
government, or its political subdivisions, of a treaty country. WP is required to collect and report
(as required on Form 1042-S) the specific category of limitation on benefits provision from all of
its entity partners, including a government (or its political subdivisions). WP may rely on a

30

partner’s claim of the specific category of limitation on benefits provision absent actual
knowledge that the claim is unreliable or incorrect
ty country. WP is required to collect and report
(as required on Form 1042-S) the specific category of limitation on benefits provision from all of
its entity partners, including a government (or its political subdivisions). WP may rely on a

30

partner’s claim of the specific category of limitation on benefits provision absent actual
knowledge that the claim is unreliable or incorrect.
(C) A WP that is a foreign reverse hybrid entity may reduce the rate of withholding on an item of
income under chapter 3 based on a partner’s claim of treaty benefits only if the partner is not
fiscally transparent in the jurisdiction in which it is resident with respect to the item of income,
and WP (and, if applicable, any flow-through entity through which the partner holds an interest
in WP) is considered to be fiscally transparent under the laws of the partner’s jurisdiction with
respect to the item of income. The claim of treaty benefits must be based on the tax treaty
between the United States and the jurisdiction where the partner is resident. To determine
when WP is treated as fiscally transparent under the laws of the partner’s jurisdiction with
respect to the item of income, see the rules in §1.894-1(d)(3)(iii).
Sec. 4.04. Documentation for International Organizations. WP may not treat a partner as an
international organization entitled to an exemption from withholding under section 892 unless
WP has determined that no chapter 4 withholding is required and it obtains a Form W-8EXP (or
documentary evidence as permitted under section 4.01(A) of this Agreement) from the
international organization. The name provided on the documentation must be the name of an
entity designated as an international organization by executive order pursuant to 22 United
States Code 288 through 288f. If an international organization is not claiming benefits under
section 892 but under another Code exception, the provisions of section 4.02 of this Agreement
apply rather than the provisions of this section 4.04
The name provided on the documentation must be the name of an
entity designated as an international organization by executive order pursuant to 22 United
States Code 288 through 288f. If an international organization is not claiming benefits under
section 892 but under another Code exception, the provisions of section 4.02 of this Agreement
apply rather than the provisions of this section 4.04.
Sec. 4.05. Documentation for Foreign Governments and Foreign Central Banks of Issue.
(A) Documentation for a Foreign Government or Foreign Central Bank of Issue Claiming an
Exemption from Withholding Under Section 892 or Section 895. WP may not treat a partner as a
foreign government or foreign central bank of issue exempt from withholding under section 892
or 895 unless WP has determined that no chapter 4 withholding is required and--
(1) WP receives from the partner a Form W-8EXP (or documentary evidence as permitted under
section 4.01(A) of this Agreement) establishing that the partner is a foreign government or
foreign central bank of issue;
(2) The income distributed to, or included in the distributive share of, the partner is the type of
income that qualifies for an exemption from withholding under section 892 or 895; and
(3) WP does not know, or have reason to know, that the partner is a controlled commercial
entity as described in section 892, that the income owned by the foreign government or foreign
central bank of issue is being received from a controlled commercial entity, or that the income is
from the disposition of an interest in a controlled commercial entity.
(B) Treaty Benefits. WP may not treat a partner as a foreign government or foreign central bank
of issue entitled to a reduced rate of withholding under an income tax treaty for purposes of
chapter 3 unless WP has determined that no chapter 4 withholding is required and it has valid
documentation that is sufficient to obtain a reduced rate of withholding under a treaty, as
described in section 4.03 of this Agreement
may not treat a partner as a foreign government or foreign central bank
of issue entitled to a reduced rate of withholding under an income tax treaty for purposes of
chapter 3 unless WP has determined that no chapter 4 withholding is required and it has valid
documentation that is sufficient to obtain a reduced rate of withholding under a treaty, as
described in section 4.03 of this Agreement.
(C) Other Code Exception. If a foreign government or foreign central bank of issue is not
claiming benefits under section 892 or 895 or a reduced rate under an income tax treaty but
under another Code exception (e.g., the portfolio interest exception under section 871(h) or
881(c)), the provisions of section 4.02 of this Agreement apply rather than the provisions of this
section 4.05.
Sec. 4.06. Documentation for Foreign Tax-Exempt Organizations. To the extent that WP
determines that an amount distributed to, or included in the distributive share of, a partner is not

31

subject to withholding under chapter 4, WP may not treat the partner as a foreign tax-exempt
organization and reduce the rate of withholding or exempt the partner from withholding for
purposes of chapter 3 unless WP satisfies the requirements provided in section 4.06(A), (B), or
(C) of this Agreement.
(A) Reduced Rate of Withholding Under Section 501. WP may not treat a partner as a foreign
organization described under section 501(c), and therefore exempt from withholding under
chapter 3 (or, if the partner is a foreign private foundation, subject to withholding at a 4-percent
rate under section 1443(b)) unless WP obtains a valid Form W-8EXP with Part IV of the form
completed.
(B) Treaty Exemption
ced Rate of Withholding Under Section 501. WP may not treat a partner as a foreign
organization described under section 501(c), and therefore exempt from withholding under
chapter 3 (or, if the partner is a foreign private foundation, subject to withholding at a 4-percent
rate under section 1443(b)) unless WP obtains a valid Form W-8EXP with Part IV of the form
completed.
(B) Treaty Exemption. WP may not treat a partner as a foreign organization that is tax-exempt
on an item of income pursuant to a treaty unless WP obtains valid documentation as described
under section 4.03 of this Agreement that is sufficient for obtaining a reduced rate of withholding
under the treaty and the documentation establishes that the partner is an organization exempt
from tax under the treaty on that item of income.
(C) Other Exceptions. If a tax-exempt entity is not claiming a reduced rate of withholding
because it is a foreign organization described under section 501(c) or under a treaty article that
applies to exempt certain foreign organizations from tax, but is claiming a reduced rate of
withholding under another Code or treaty exception, the provisions of section 4.02 or 4.03 of this
Agreement (as applicable) shall apply rather than the provisions of this section 4.06.
Sec. 4.07. Documentation from Passthrough Partners. Except as otherwise provided in
section 9 of this Agreement, WP shall not act as a withholding foreign partnership with respect
to an amount distributed to, or included in the distributive share of, a passthrough partner. WP
must forward the passthrough partner’s documentation (and associated withholding statement
and documentation of indirect partners) to the withholding agent from whom WP receives a
reportable amount.
Sec. 4.08. Documentation for U.S. Exempt Recipients. WP shall not treat a partner as a U.S.
exempt recipient unless WP obtains from the partner—
(A) A valid Form W-9 on which the partner includes an exempt payee code to certify that the
partner is a U.S
sociated withholding statement
and documentation of indirect partners) to the withholding agent from whom WP receives a
reportable amount.
Sec. 4.08. Documentation for U.S. Exempt Recipients. WP shall not treat a partner as a U.S.
exempt recipient unless WP obtains from the partner—
(A) A valid Form W-9 on which the partner includes an exempt payee code to certify that the
partner is a U.S. exempt recipient;
(B) Documentary evidence, as permitted under section 4.01(A) of this Agreement, that is
sufficient to establish that the partner is a U.S. exempt recipient; or
(C) Documentary evidence, as permitted under section 4.01(A) of this Agreement, that is
sufficient to establish the partner’s status as a U.S. person and WP can treat the partner as an
exempt recipient under the rules of §§1.6045-2(b)(2)(i) or 1.6049-4(c)(1)(ii), as appropriate,
without obtaining documentation.
Sec. 4.09. Documentation for U.S. Non-Exempt Recipients. WP shall not treat a partner as a
U.S. non-exempt recipient unless WP obtains a valid Form W-9 from the partner.
Sec. 4.10. Documentation Validity.
(A) In General. WP may not rely on documentation if WP has actual knowledge or reason to
know that the information or certifications contained in the documentation provided by a partner
is unreliable or incorrect, or that there is a change in circumstances with respect to the
information or statements contained in the documentation or in WP’s files (account information)
pertaining to the obligation that affects the reliability of the partner’s claim. See §1.1441-
1(e)(4)(ii)(D) for the definition of change in circumstances. Once WP knows, or has reason to
know, that documentation provided by a partner is unreliable or incorrect to establish foreign
status or residency for purposes of claiming benefits under an applicable income tax treaty, it
nt information)
pertaining to the obligation that affects the reliability of the partner’s claim. See §1.1441-
1(e)(4)(ii)(D) for the definition of change in circumstances. Once WP knows, or has reason to
know, that documentation provided by a partner is unreliable or incorrect to establish foreign
status or residency for purposes of claiming benefits under an applicable income tax treaty, it

32

can no longer reliably associate a payment with valid documentation unless it obtains additional
documentation to establish the partner’s chapter 3 status. If WP can no longer reliably
associate a payment with valid documentation, it must obtain new documentation prior to the
time withholding is required under section 3 of this Agreement. With respect to a withholding
agent’s reason to know that a claim for treaty benefits is unreliable or incorrect based on the
existence of a tax treaty, the rules in §1.1441-6(b)(1)(ii) will apply to preexisting partners for
which WP held valid documentation upon a change in circumstances or, with respect to a
preexisting entity partner, when it provides a written limitation on benefits statement (as
described in section 4.03(B) of this Agreement). For all partners admitted on or after January 1,
2017, this rule will apply on admission of the partner to the partnership. For purposes of this
section 4.10(A), a “preexisting partner” or “preexisting entity partner” is a partner documented by
WP prior to January 1, 2017, for a WP with a WP Agreement in effect prior to that date. For a
WP that did not have a WP Agreement in effect prior to January 1, 2017, a “preexisting partner”
or “preexisting entity partner” means a partner that was admitted to the partnership (and for
which WP has valid documentation) prior to the effective date of its WP Agreement.
(B) General Rules.
ed by
WP prior to January 1, 2017, for a WP with a WP Agreement in effect prior to that date. For a
WP that did not have a WP Agreement in effect prior to January 1, 2017, a “preexisting partner”
or “preexisting entity partner” means a partner that was admitted to the partnership (and for
which WP has valid documentation) prior to the effective date of its WP Agreement.
(B) General Rules.
(1) WP shall not rely on a Form W-9 if it is not permitted to do so under the rules of §31.3406(h)-
3(e) or if it has been informed by the IRS or another withholding agent that the form is unreliable
or incorrect and shall not rely on a Form W-8 if it is not permitted to do so under this section
4.10.
(2) WP shall not treat documentary evidence provided by a partner as valid if the documentary
evidence does not reasonably establish the identity of the person presenting the documentary
evidence. For example, documentary evidence is not valid if it is provided in person by a partner
that is a natural person and the photograph on the documentary evidence, if any, does not
match the appearance of the person presenting the document.
(3) WP may not rely on documentation to reduce the withholding rate that would otherwise apply
if—
(a) The partner’s documentation is incomplete or contains information that is inconsistent with
the partner’s claim,
(b) WP has other information in the account information that is inconsistent with the partner’s
claim, or
does not
match the appearance of the person presenting the document.
(3) WP may not rely on documentation to reduce the withholding rate that would otherwise apply
if—
(a) The partner’s documentation is incomplete or contains information that is inconsistent with
the partner’s claim,
(b) WP has other information in the account information that is inconsistent with the partner’s
claim, or
(c) The documentation lacks the information necessary to establish entitlement to a reduced
rate of withholding.
For example, if a direct partner that is an entity provides documentation to claim treaty benefits
and the documentation establishes the direct partner’s status as a foreign person and a residen

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## Nearby sections

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Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/IRS_RP_2017_21. Check the current official text before relying on it. Not legal advice.