FATCA & CRS Alert 2020-07
FATCA & CRS Alert 2020-07
IRS updates FATCA registration system
On 29 September 2020, the IRS announced it has updated the Foreign Account Tax Compliance Act (FATCA) registration system.
The changes are summarized as follows:
- Delete registration: A financial institution can no longer delete its registration once it’s initiated, submitted or incomplete. Along these same lines, a lead financial institution can no longer delete member registrations when in any of the aforementioned stages. However, after a registration has an approved status, a financial institution can cancel the registration.
- Sponsored entity table (sponsoring entities only): A status date has been added to the sponsored entity table, and a display of effective date for terminated sponsored entities has been added.
- Email address fields: There is an updated validation measure.
Reference: IRS transmittal message
As a reminder, the Luxembourg Tax Authorities require a FATCA return (and in the absence of reportable accounts, a FATCA "nil return") per year from each Luxembourg reporting financial institution registered with the IRS.
Also, a Luxembourg financial institution deregistered with the IRS is required to provide a return in relation to the year of its deregistration. Thus, Luxembourg financial institutions should review their FATCA status and registration requirements prior to year-end. This will help to avoid having to file in 2022 (with respect to 2021), if not otherwise required.
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