FATCA Compliance deadline extended for QIs

The US Internal Revenue Service (IRS) is giving qualified intermediaries (QIs) an extra year to achieve compliance with the Foreign Accounts Tax Compliance Act (FATCA), which requires foreign banks to notify the assets of US taxpayers to the IRS.

Foreign banks cannot remain as QIs unless they become FATCA-compliant, and those whose QI status expires at the end of 2012 have now had their renewal date extended until the end of 2013.

Qualified Intermediaries and FATCA Implementation

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Though final regulations for foreign financial institutions (FFIs) have not been issued, some basics of the administration of the Qualified Intermediary (QI) Program and FATCA implementation are known. These include the following:

1. QI's must become FATCA compliant to retain their QI status and the QI agreement will be modified to reflect the Chapter 4 requirements.

2. The renewal of the QI agreement for QI's whose renewal is expiring December 31, 2012 has been extended per Notice 2011-53 until December 31, 2013.

3. The renewal of the QI agreement will be accomplished through the online FATCA FFI registration system. This online registration system will be available no later than Jan. 1, 2013.