26 CFR 31.3406(e)-1 - Period during which backup withholding is required.

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There are 11 Updates appearing in the Federal Register for 26 CFR 31. View below or at eCFR (GPOAccess)
§ 31.3406(e)-1 Period during which backup withholding is required.
(a) In general. A payor must withhold under section 3406 at a rate of 31 percent on any reportable payment (as defined in section 3406(b)) made to a payee during the period described in this section (irrespective of the number of conditions for imposing withholding under section 3406 that exist with respect to the payee). A payor must continue to withhold under section 3406 until no condition for imposing backup withholding exists with respect to the payee.
(b) Failure to furnish a taxpayer identification number in the manner required—
(1) Start withholding. A payor is required to withhold under section 3406(a)(1)(A) at a rate of 31 percent on any reportable payment (as defined in section 3406(b)) at the time the payor pays the reportable payment (as described in § 31.3406(a)-4) to a payee if—
(i) The payor has not received the payee's taxpayer identification number in the manner required in § 31.3406(d)-1; or
(ii) The payor has received notice from a broker (as required in § 31.3406(d)-4(a)(1)(iii)) with respect to a readily tradable instrument that the payee did not furnish a taxpayer identification number to the broker in the manner required in § 31.3406(d)-1 and the payor has not received the taxpayer identification number from the payee in this manner.
(2) Stop withholding. The payor must stop withholding under section 3406(a)(1)(A) within 30 days after the payor receives—
(i) The payee's taxpayer identification number in the manner required under § 31.3406(d)-1; or
(ii) A statement, in such form and containing such information as is required under applicable regulations, that the payee is not a United States person.
(c) Notification of an incorrect taxpayer identification number. See § 31.3406(d)-5(e) and (g)(3) for the period for which withholding is required in the case of notification of an incorrect taxpayer identification number.
(d) Notified payee underreporting. See § 31.3406(c)-1(e) for the period for which withholding is required in the case of notified payee underreporting.
(e) Payee certification failure—
(1) Start withholding. A payor is required to withhold under section 3406(a)(1)(D) at a rate of 31 percent on any reportable interest or dividend payment (as defined in section 3406(b)(2)) at the time the payor pays such reportable interest or dividend payment (as described in § 31.3406(a)-4) to a payee if—
(i) The payor has not received from the payee the certification required in § 31.3406(d)-2; or
(ii) The payor has received notice from a broker (as required in § 31.3406(d)-4(a)(1)(iii)) with respect to a readily tradable instrument that the payee did not make the required certification and the payor has not received the required certification from the payee.
(2) Stop withholding. The payor must stop withholding under section 3406(a)(1)(D) on any reportable interest or dividend payment within 30 days after the payor receives the certification from the payee in the manner required by § 31.3406(d)-2.
(f) Rule for determining when the payor receives a taxpayer identification number or certificate from a payee. In determining whether a payee has failed to provide a taxpayer identification number or any certification to a payor (including a Form W-8 or substitute form), a payor is required to process the taxpayer identification number or certification within 30 days after the payor receives the taxpayer identification number or certification from the payee or in certain cases, from a broker. Thus, the payor may take up to 30 days to treat the taxpayer identification number or a certificate as having been received.
[T.D. 8637, 60 FR 66127, Dec. 21, 1995]

Title 26 published on 2013-04-01

The following are only the Rules published in the Federal Register after the published date of Title 26.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

  • 2014-09-16; vol. 79 # 179 - Tuesday, September 16, 2014
    1. 79 FR 55362 - Authority for Voluntary Withholding on Other Payments
      GPO FDSys XML | Text
      DEPARTMENT OF THE TREASURY, Internal Revenue Service
      Final regulations and removal of temporary regulations.
      Effective Date: These regulations are effective on September 16, 2014. Applicability Date: For date of applicability, see § 31.3402(p)-1(d).
      26 CFR Part 31

Title 26 published on 2013-04-01

The following are ALL rules, proposed rules, and notices (chronologically) published in the Federal Register relating to 26 CFR 31 after this date.

  • 2014-09-16; vol. 79 # 179 - Tuesday, September 16, 2014
    1. 79 FR 55362 - Authority for Voluntary Withholding on Other Payments
      GPO FDSys XML | Text
      DEPARTMENT OF THE TREASURY, Internal Revenue Service
      Final regulations and removal of temporary regulations.
      Effective Date: These regulations are effective on September 16, 2014. Applicability Date: For date of applicability, see § 31.3402(p)-1(d).
      26 CFR Part 31