One of the more confusing areas of international tax law is determining when withholding is required. Getting it wrong can have dire consequences.
Currently, U.S. international withholding provisions can be found in Chapters 3 and 4 of the Internal Revenue Code. Chapter 3 contains the withholding provisions that are intended to approximate a foreign person’s U.S. federal income tax liability. Chapter 4, on the other hand, deals with withholding provisions put in place by the Foreign Accounts Tax Compliance Act of 2010 and is primarily aimed at obtaining information regarding account holders of foreign financial institutions and owners of certain foreign entities.
In this post, we’ll focus on Chapter 3 withholding, setting aside Chapter 4 for another time.
But first . . .
Why International Tax Withholding?
Recent Comments