WOLF & CO Alerts International Alert: Doing Business with Foreign Investors or Foreign Account holders? Certain W-8BEN and W-8BEN-E Forms Expiring on December 31st

International Alert: Doing Business with Foreign Investors or Foreign Account holders? Certain W-8BEN and W-8BEN-E Forms Expiring on December 31st

Written by: Rita M. Ryan, J.D, LL.M.

Do you have foreign investors or foreign account holders?  The IRS issued revised and final Forms W-8 this month.  A summary of the noteworthy changes and updates is detailed below.

What is it?

Form W-8 BEN-E is used by foreign entities to provide identifying information to U.S. fund managers or U.S. financial institutions to document their status for U.S. withholding purposes (Chapter 3 Non-Resident Withholding and Chapter 4 FATCA Withholding) and claim any reduction or elimination of withholding because of tax treaty application.

Without this form, U.S. investment funds or U.S. financial institutions (U.S. payors) must withhold at a 30% rate on certain items of U.S. source (interest, dividends, and other income not-effectively connected with a U.S. trade or business) or if dealing with foreign financial institutions, withholding of 30% of the gross payment made.

Why Revised?

The forms were revised to reflect the changes to the Chapter 3 withholding regulations, as well as to capture the new withholding requirements under IRC Section 1446 on sales of interests in publicly traded partnerships (PTP) and distributions by the same.

Changes of Note:

  • W-8BEN-E, Line 14b – “No LOB in treaty” added.  The revised instructions indicate that this box must be checked by a resident of a country whose treaty does not have a Limitation on Benefits (LOB) Article.  LOB articles are considered anti-treaty shopping provisions intended to prevent “treaty shopping” and reserve use for those sufficiently connected to one of the countries in the tax treaty.
  • W-8BEN, Part III, Certification – this is similar the check box already included on Form W-8BEN-E. The updated instructions indicate that this box must only be checked when the W-8BEN is signed by an agent acting under an authorized power of attorney for the individual disclosed in Line 1 of the form.  The power of attorney must accompany the W-8BEN when submitted to the withholding agent.
  • Taxpayer Identification Numbers– The revised Forms W-8 add a new checkbox to indicate that a foreign taxpayer identification number (FIN) is “not legally required.” Beneficial owners who open accounts in the U.S. are currently required to provide either a FIN or a reasonable explanation for not providing one.  This update would eliminate the reasonable cause requirement when no FIN is provided.
  • Taxpayer Identification Numbers, for IRC Section 1446(f) – The updated instructions to the revised Forms W-8 indicate that the form MUST include a US taxpayer identification number if the form is provided by a partner in a partnership that is considered to have a U.S. trade or business. A missing tax identification number appears to invalidate Forms W-8 for Section 1446(f) withholding purposes. If invalidated, IRC section 1446(f) withholding (i.e. 10% of the amount realized) would apply regardless of an exemption under a qualified notice or treaty claim.
  • Electronic Signatures – The revised instructions for the Forms W-8 incorporate revised electronic signature requirements provided in the final regulations that were issued In December 2019. Withholding agents are permitted to consider date stamps or other electronic certifications that support that a Form W-8 was electronically signed.

Must New Forms W-8 be Obtained Now?

Prior versions of the Forms W-8 can continue to be accepted until the end of six full months after the revision shown on the updated Form W-8, meaning the revised forms MUST be used beginning May 1, 2022.

Forms W-8 obtained before the May 2022 cutoff date, whether completed on the revised form or not, continue to be valid for the 3 year period discussed in more detail below.

New Forms W-8 should be obtained for any party subject to the PTP withholding requirements of IRC Section 1446 on payments made after December 31, 2022.

Expiration Dates:

Forms W-8 will continue to remain valid for a period of 3 years, unless information on the form or circumstances change.  Therefore, a Form W-8BEN signed on September 30, 2018, remains valid through December 31, 2021.

Forms must be updated immediately if there is a change in circumstance that makes any information on the form incorrect – i.e. address change, entity classification change, tax treaty update to withholding rates, or mail hold/mail forwarding related to the original address provided.

What if a form has expired?

All maximum statutory rates of withholding noted above apply until a new form is received.

How Can We Help?

Wolf’s International Tax Team can provide outsourced Forms W-8 process review including:

  • review of all provided Forms W-8 (W-8BEN-E, W-8IMY, etc.) to ensure proper completion for foreign investors and foreign account holders,
  • review of internal controls concerning the payment of U.S. source income to the foreign investor or account holder,
  • review of withholding procedures and subsequent reporting of that information to the IRS and the investor or account holder,
  • review of expiration date tracking for all forms, and
  • for investment managers specifically, compiling W-8IMY packages.


For more information or if you have questions on the above, please reach out to the following Wolf team representatives:

Wolf & Company, P.C.
255 State Street, Boston, MA 02109
Direct +1 (617) 428-5464
[email protected]

International Tax Senior Manager
Wolf & Company, P.C.
255 State Street, Boston, MA 02109
Direct +1(617) 419-4202
[email protected]

Tax Manager
Wolf & Company, P.C.
255 State Street, Boston, MA 02109
Direct +(617) 419-4246
[email protected]