IRS eases application process for US residency certification

By Paul Bonner

The IRS temporarily revised its procedures effective Monday for some submitters of Form 8802, Application for United States Residency Certification, to facilitate applications where the Service has not yet completed its processing of the applicant's most recently filed tax return.

The new policy, announced on the IRS's website, applies to applicants whom the IRS has asked for a signed copy of their most recent return to support their application because that return had been filed but not yet posted when they filed Form 8802. In that case, applicants may submit a signed copy of their current-year filed base income tax return as filed but without accompanying forms, schedules, or attachments.

If applicants are unsure whether the IRS has posted their most recent return, they may wish to submit the signed current-year base return with Form 8802 to expedite their application, the IRS said.

The policy, which applies to applicants requesting a two-year certification, took effect Monday and will last for a two-year pilot period with a possible further extension, the IRS said.

Form 8802 is used to request Letter 6166, Certification of U.S. Tax Residency, which certifies U.S. residency, typically, for claiming benefits of another country's tax treaty with the United States, including exemption from the other country's value-added tax. Individuals, partnerships, trusts, estates, corporations, and tax-exempt entities are among parties that can seek a Letter 6166, often to reduce or eliminate foreign withholding and/or avoid double taxation internationally.

In general, the IRS issues Letter 6166 only where it can verify that the applicant filed an appropriate income tax return for the tax year for which certification is requested or, if a return is not yet due for the certification year, a return for the most recent year for which a return was due. If the applicant is not required to file an income tax return for the tax period on which certification will be based, the certification will be based on other documentation provided.

— To comment on this article or to suggest an idea for another article, contact Paul Bonner at Paul.Bonner@aicpa-cima.com.

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