The Internal Revenue Service (IRS) has published rev. Proc on December 30, 2016. 2017-15, which includes the final agreement of qualified intermediary (IQ) 2017 (IQ agreement 2017). The 2017 qi agreement provides for procedures for QIs (including qualified derivatives traders (QDDs) and eligible securities lenders (QSLs) to meet their reporting and retention obligations in the United States. For more information, check out our Insight: IRS publishes the qualified final agreement. Historically, the IQ application process was a paper process that included filling out Form 14345, applying for qualified intermediaries, retaining foreign partnerships or foreign trust retention, and IRS authorization. The IRS is currently implementing an electronic qi application process (Qi Portal). In addition to the app itself, the IQ portal has a link to a user manual and a range of frequently asked questions (FAQs) as well as links to other resources for portal users. See www.irs.gov/businesses/corporations/qualified-intermediary-system. Like the systems used to manage agreements on foreign financial institutions (FFI), the IQ portal provides users with a secure system, a convenient way to download certain support documents, the ability to obtain electronic notifications about status changes, renewal reminders and other updates, and reduces the need to contact the IRS directly in many cases.
Observation: The IQ portal is the system that retains foreign partnerships (WPs) and retains foreign trusts (WTs) to apply for WP and WT status. The WP and WT agreements technically expired on December 31, 2016. The IRS indicated that the WP and WT agreements, which were in effect prior to December 31, 2016, will continue until the agreements are updated in January 2017. Manage tax accounting issues and focus on the strategic tax aspects of the business. Providing tax services, knowledge and guidelines on U.S. tax policy, tax reform, legislation, registration and tax law. Potential IQs and IQs that renew their status should take into account the additional information that needs to be provided in the application. In the case of QDDs, the amount of information required can present real challenges for their ability to complete the application process in a timely manner. The 2017 qi agreement provides that 2017 is a “phase-in-year” for QDDs acting in good faith. I hope that this approach will also apply to efforts to complete the application process. Principal, Tax Controversy and Regulatory Services Leader, PwC US Tax strategies are more critical than ever.
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