On February 28, 2023, the Supreme Court decided Bittner v. United States—a rare Supreme Court foray into Financial Crimes Enforcement Network or FinCEN reporting of foreign bank and financial accounts under the Bank Secrecy Act (“BSA”). The BSA is
Tax Withholding & Reporting
The Tax Withholding & Reporting blog, published by Covington & Burling LLP, focuses on developments and guidance related to tax withholding obligations and reporting requirements under U.S. federal tax law. It covers topics such as IRS regulations on compensation deduction limitations for publicly held corporations, tax treatment of contributions and benefits under state paid family and medical leave programs, withholding rules for retirement plan distributions to U.S. taxpayers abroad, and tax implications of employer-provided work-life referral services. The blog addresses regulatory updates, compliance considerations, and practical implications for employers, employees, and payors in various withholding and reporting contexts.
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Treasury and IRS Extend Olive Branch to Reporting Model 1 FFIs and Model 1 IGA Jurisdictions Regarding U.S. TIN Reporting for Certain U.S. Accounts
Last week, the IRS issued Notice 2023-11 providing relief procedures for foreign financial institutions (“FFIs”) in countries with Model 1 intergovernmental agreements (“IGAs”) that have failed to provide U.S. taxpayer identification numbers (“TINs”) for certain preexisting accounts. Preexisting…
IRS Delays Gross Proceeds Reporting, Basis Reporting, and Transfer Statements between Brokers on the Disposition or Transfer of Digital Assets until Final Regulations are Issued
This afternoon, in Announcement 2023-2, the IRS announced that brokers are not required to report additional information with respect to dispositions of digital assets until the IRS and Treasury issue final regulations under sections 6045 and 6045A. The Infrastructure…
IRS Publishes Last Minute Reprieve for Implementation of New Form 1099-K Reporting Threshold
Today, in Notice 2023-10, the IRS announced a delay in the new reduced reporting threshold for section 6050W applicable to third-party settlement organizations (TPSOs). Section 9674(a) of the American Rescue Plan Act of 2021 amended section 6050W(e) to provide…
FinCEN Releases Final Rule on Beneficial Ownership Disclosure Requirements: Seven Things To Know
[This post was originally published as an Alert by Covington Financial Services.]
On September 29, 2022, the Financial Crimes Enforcement Network (“FinCEN”) issued the first of three final rules (the “Final Rule”) implementing the Corporate Transparency Act…
Administration Proposes New Withholding Requirements for 409A Failures
Last week, the Treasury Department released the “Green Book,” formally known as the General Explanations of the Administration’s Revenue Proposals. Among its proposals, the Green Book includes a new proposal that could signal stepped-up enforcement of section 409A,…
Administration Proposes W-9 Requirement for More Reportable Payments
Last week, the Treasury Department released the “Green Book,” formally known as the General Explanations of the Administration’s Revenue Proposals. Among its proposals, the Green Book suggests the expansion of the requirement to collect Forms W-9 to additional…
Treasury Stakes Out a Position on “On-Demand Pay” Arrangements
Last week, the Treasury Department released the “Green Book,” formally known as the General Explanations of the Administration’s Revenue Proposals. Among its proposals, the Green Book addresses the treatment of on-demand pay arrangements. These arrangements, which have recently…
FinCEN Releases Notice of Proposed Rulemaking on Beneficial Ownership Disclosure Requirements: Seven Things To Know
[This post was originally published as an Alert by Covington Financial Services.]
On December 7, 2021, the Financial Crimes Enforcement Network (“FinCEN”) invited public comment on its proposed rule (the “Proposed Rule”) implementing the beneficial ownership disclosure…
IRS Releases Form 1042-S Data Integrity Tool to Assist Withholding Agents in Complying With Withholding and Reporting Obligations
The Internal Revenue Service recently released an online tool to help U.S. withholding agents comply with withholding and reporting obligations on IRS Form 1042-S, Foreign Person’s U.S. Source Income Subject to Withholding. Forms 1042-S are issued by withholding agents…