In accordance with the Taiwan Relations Act, the parties to the agreement are the American Institute in Taiwan and the Taipei Economic and Cultural Representative Office in the United States. The system will also not allow accelerated certifications (for example. B certifications that expire in 2018 for a company with an effective FFI agreement that will be effective after 2014) only in the case of a Certified Lead FI on behalf of its members or a sponsoring unit certified on behalf of its sponsored companies. The system lists all members or sponsored companies under the main FI or sponsorship unit that have effective FATCA agreements before December 31, 2017 and gives lead or sponsoring entity the ability to align certification periods. The system does not include member companies or sponsorship companies with fatca requirements that apply after December 31, 2017. A PFFI (or RM2FFI) that terminated its contract prior to the July 2018 IRS update, but after December 31, 2016, is expected to submit regular certification in the IRS system until December 15, 2018. Access to the account has expired in most of these cases, so entities must seek IRS assistance to re-access certification. The IRS intends to publish specific guidance on this scenario. Based on the answers to the copa questions, the system assigns the company a COPA result. Available results are Due Diligence, Failure to Certify, Not Required or Qualified Certification. Descriptions of each of these results are available on page 57 of the FATCA online registration users guide (Pub 5118 – July 2018). “Due Diligence” means that the OR did not find an IF failure to meet any of the requirements of the account`s existing due diligence, which was not corrected before the certification date.
A “qualified certification” means that an error that was not corrected at the time of certification has been detected and requires the company to respond to an IRS error notification. In this case, the entity must provide the IRS with a written description and plan to correct any material errors. On July 19, 2018, the U.S. Internal Revenue Service (IRS) announced upgrades to the Foreign Account Tax Compliance Act (FATCA) Registration Act (FATCA) and then released an updated FATCA online registration manual. On July 24, 2018, the IRS also published frequently asked questions (FAQs) about FATCA status, existing account certification (COPA) and regular certifications. These FAQs announced a longer deadline of December 15, 2018 for COPA and the periodic certifications required for companies that registered their FATCA status on or before January 1, 2015. On July 31, 2018, the IRS confirmed the completion of the system upgrades. FATCA registration system upgrades expand fatca status options and add COPA and periodic certification functions for the necessary entities. The FATCA registration system defines the certification requirements for each registered company on the basis of the combination of the company`s FATCA status and the status of the Intergovernmental Agreement (IGA) of its right of residence (in general, only Model 2 jurisdictions and not igA jurisdictions have a certification requirement). It is important for companies to verify and update their FATCA status in the FATCA registration system to display the correct certification requirements and avoid inoperable certification mentions.
FATCA requires foreign financial institutions (FFIs) to report information to the IRS on the financial accounts of U.S. taxpayers or foreign companies in which U.S. taxpayers hold a significant stake. FFI are invited to either register directly with the IRS to comply with FATCA rules (and, if applicable, FFI agreements), or to comply with FATCA agreements (IGA), which are considered effective in their legal systems.