Tax on Certain Foreign Procurement

Forms and Documents

Document Name	Status
Form W-14 (2016 draft) TD 9782 (REG-103281-11) - Tax on Certain Foreign Procurement Form	Modified
Final Supporting Statement Reg_W-14 Aug 18 2016_EHC.doc Supporting Statement A	2016-08-18

IC Document Collections

IC ID	Document Title	Status
216102	TD 9782 (REG-103281-11) - Tax on Certain Foreign Procurement Form	Modified

ICR Details

OMB Control No: 1545-2263	ICR Reference No: 201607-1545-037
Status: Historical Active	Previous ICR Reference No: 201504-1545-007
Agency/Subagency: TREAS/IRS	Agency Tracking No:
Title: Tax on Certain Foreign Procurement
Type of Information Collection: New collection (Request for a new OMB Control Number)	Common Form ICR:  No
Type of Review Request: Emergency	Approval Requested By: 08/18/2016
OIRA Conclusion Action: Approved without change	Conclusion Date: 08/19/2016
	Date Received in OIRA: 08/18/2016
Terms of Clearance:

	Inventory as of this Action	Requested	Previously Approved
Expiration Date	02/28/2017	6 Months From Approved
Responses	2,000	0	0
Time Burden (Hours)	11,840	0	0
Cost Burden (Dollars)	0	0	0

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Abstract: Tax on Certain Foreign Procurement, Notice of Purposed Rulemaking, contains proposed regulations under section 5000C of the Internal Revenue Code. The proposed regulations affect U.S. government acquiring agencies and foreign persons providing certain goods or services to the U.S. government pursuant to a contract. This document also contains proposed regulations under section 6114, with respect to foreign persons claiming an exemption from the tax under an income tax treaty. Section 5000C imposes a 2% tax on foreign persons (as defined in section 7701(a)(30)), that are parties to specified Federal procurement contracts with the U.S. government entered into on and after January 2, 2011. This tax is imposed on the gross amount of specified Federal procurement payments and is generally collected by increasing the amount withheld under chapter 3. A Form W-14 must be provided to the acquiring agency (U.S. government department, agency, independent establishment, or corporation) to: Establish that they are a foreign contracting party; and If applicable, claim an exemption from withholding based on an international agreement (such as a tax treaty); or Claim an exemption from withholding, in whole or in part, based on an international procurement agreement or because goods are produced, or services are performed in the United States. A Form W-14 must be provided to the acquiring agency if a foreign contracting party has been paid a specified Federal procurement payment and the foreign contracting party is seeking to claim an exemption (in whole or in part) from the tax imposed by section 5000C. Form W-14 must be submitted when requested by the acquiring agency, whether or not an exemption (in whole or in part) is claimed from withholding under section 5000C.

Emergency Justfication: Expedited clearance of the final regulations and Form W-14 are warranted due to the public’s urgent need for the guidance contained in these documents. Section 5000C imposes a 2% tax on specified Federal procurement payments made on or after January 2, 2011. The 2% tax is collected primarily via withholding by Federal agencies making applicable specified Federal procurement payments. Despite the statutory effective date, the lack of final regulations has been given as a reason for failures to comply with the statutory requirements under section 5000C. Further, Form W-14 is used by persons who are (in whole or in part) exempt from the tax to establish this exemption to a Federal agency, and thus this form is urgently needed to prevent Federal agencies from unnecessarily withholding amounts from persons exempt from the tax. Thus, taxpayers and Federal agencies have an urgent need for this guidance and form.

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Authorizing Statute(s): US Code: 26 USC 5000C Name of Law: Imposition of tax on certain foreign procurement
  

Citations for New Statutory Requirements: None

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
1545-BK06	Final or interim final rulemaking	81 FR 55133	08/18/2016

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Federal Register Notices & Comments
60-day Notice:	Federal Register Citation:	Citation Date:
	80 FR 22449	04/22/2015
Did the Agency receive public comments on this ICR? No

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Number of Information Collection (IC) in this ICR: 1

IC Title	Form No.	Form Name
TD 9782 (REG-103281-11) - Tax on Certain Foreign Procurement	W-14 (2016 draft)	Certificate of Foreign Contracting Party Receiving Federal Procurement Payments

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ICR Summary of Burden

	Total Approved	Previously Approved	Change Due to New Statute	Change Due to Agency Discretion	Change Due to Adjustment in Estimate	Change Due to Potential Violation of the PRA
Annual Number of Responses	2,000	0	0	2,000	0	0
Annual Time Burden (Hours)	11,840	0	0	11,840	0	0
Annual Cost Burden (Dollars)	0	0	0	0	0	0

Burden increases because of Program Change due to Agency Discretion: Yes

Burden Increase Due to: Changing Regulations

Burden decreases because of Program Change due to Agency Discretion: No

Burden Reduction Due to:

Short Statement: Burden has increased as this is a new regulation and new information collection request. The estimated number of responses is 2,000 and is estimated that it will take an estimated 5 hours and 55 minutes per response (1.9 hours for reporting and 4.83 hours of recordkeeping). This results in an overall estimated annual time burden increase of 11,840 hours.

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Annual Cost to Federal Government: $0

Does this IC contain surveys, censuses, or employ statistical methods? No

Is the Supporting Statement intended to be a Privacy Impact Assessment required by the E-Government Act of 2002? No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? No

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? Uncollected

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Common Form ICR:  No

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On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).

The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(i) Why the information is being collected;

(ii) Use of information;

(iii) Burden estimate;

(iv) Nature of response (voluntary, required for a benefit, or mandatory);

(v) Nature and extent of confidentiality; and

(vi) Need to display currently valid OMB control number;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.

Certification Date: 08/18/2016

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