TaxTMI 
TaxTMI 
Clarification on FAQ 6(reporting) and FAQ 3 (reporting) issued by U.S. IRS in respect of FATCA reportable accounts
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....egard, the US IRS has recently updated FAQ 6(reporting) in accordance with Notice 2023-11 with respect of US reportable accounts under the FATCA Intergovernmental Agreement between the United States of America and other Model 1 jurisdictions. 2. FAQ 6(reporting) issued by the U.S. IRS states as under: "As a Model 1 FFI you are required to obtain and exchange the U.S. taxpayer identification number (TIN) data element for each specified U.S. person that is an account holder or a controlling person of a non-U.S. entity (a specified U.S. person) in accordance with the Intergovernmental Agreement (IGA) between the United States of America and your Model 1 jurisdiction. However, in the IRS' efforts to better understand the is....
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....as below the threshold for documenting and reporting the account at the time of account opening and subsequently exceeded the threshold, and a self-certification has not been obtained. • 444444444 - Preexisting individual and entity account that (1) has U.S. indicia other than a U.S. place of birth, and (2) either: • (a) has a change in circumstances, causing the self-certification or other documentation originally obtained to be incorrect or unreliable, and a new self-certification or other documentation has not been obtained, or • (b) was below the threshold for documenting and reporting the account at the time of account opening and subsequently exceeded the threshold, and a self-certification or ot....
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.... IRS has updated the above series of TIN codes. Reporting for calendar year 2022 (due by September 30, 2023) is considered to be a transition year, and to be eligible for relief Model 1 FFIs must either use the TIN codes issued in May 2021 or the following updated TIN codes. For reporting on calendar years 2023 (due by September 30, 2024) and 2024 (due by September 30, 2025), a reporting Model 1 FFI must use the following updated codes that identify features of these accounts that may explain why the reporting Model 1 FFI cannot report a U.S. TIN. The use of these codes will allow the IRS to better understand the facts and circumstances behind the missing U.S. TINs. The updated TIN field code and related scenarios are as follows: ....
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....a being associated with the account or causes a self-certification or other documentation originally obtained to be incorrect or unreliable, and a valid self-certification or other documentation has not been obtained subsequent to the change in circumstances, or (b) was below the threshold for documenting and reporting the account on the determination date provided in the applicable Model 1 IGA and subsequently exceeded the threshold, and a self-certification or other documentation has not been obtained. • 555555555 New individual or entity account that: (1) has a U.S. indicia other than a U.S. place of birth, and (2) either: (a) has a change in circumstances causing the self-certification or....
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....tification to indicate the entry is invalid when one of the above codes is used. The error notification will provide 120 days to correct the issues, which is consistent with Paragraph 4.2.2 "Administrative or Other Minor Errors" of the Competent Authority Arrangement (CAA). Consistent with the IGA (and the CAA, if applicable), if the TIN is not provided within that 120 day period, the U.S. will evaluate the data received (including whether the reporting Model 1 FFI complies with the conditions set forth in Notice 2013-11) and whether there is significant non-compliance based on the facts and circumstances. (See Reporting FAQ #3 for a full discussion of the significant non-compliance process.)" 3. In view of the above, the Indian Reportin....