On July 12, 2013, the IRS released Notice 2013-43 (the “Notice”), which sets forth a revised timeline for the implementation of the Foreign Account Tax Compliance Act (“FATCA”).
The most significant development is that withholding under FATCA, originally required for payments made after December 31, 2013, will now apply to payments made after June 30, 2014. This six-month extension is accompanied by a six-month extension in the FATCA obligation grandfathering date. Thus, “obligations” outstanding on July 1, 2014, will be “grandfathered obligations” not subject to FATCA. The Notice states, however, that FATCA withholding for gross proceeds and passthru payments, set to take effect beginning January 1, 2017, will not be affected.
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