In the past, a bank acting as a QI had the option to enter in an agreement with a nonwithholding foreign partnership or nonwithholding foreign trust to apply the simplified joint account documentation, reporting and withholding procedures.
The requirements for the application of the joint account provision have been amended with the new QI Agreement (QIA). In particular, under the provisions of the Section 4.05 of the new QIA (provided in Revenue Procedure 2014-39, that was amended by the Revised QI Agreement of 23 September 2014), the conditions to qualify as an eligible partnership or trust for the joint account provision are:
In order to provide QIs with sufficient time to adapt their documentation procedures, the IRS provided that during a transition phase (i.e. the period beginning on the effective date of the QI Agreement, and after an extension, ending 30 June 2015), a QI that has entered into an agreement under section 4A.01 of the former QI Agreement with a partnership or trust to apply the joint account option before 30 June 2014, may continue to document the account consistent with section 4A.01 of the former QI Agreement.
After 30 June 2015 a QI should ensure that to apply the joint account provision the account is documented as follows:
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