Common use of Withholding Determination in General Clause in Contracts

Withholding Determination in General. A participating FFI that makes a withholdable payment is required to determine whether withholding under this section 4 applies at the time the withholdable payment is made by applying the requirements of §1. 1471-4(b) to determine the payee of the payment and to reliably associate the payment with valid documentation to establish the payee’s chapter 4 status. The exceptions to withholding described in §1.1471-2, including the exceptions for payments made under a grandfathered obligation and payments made to certain excepted accounts, apply for purposes of determining whether withholding is required under this section 4. A participating FFI is not required to withhold under this section 4 on payments made to an account holder of a preexisting account prior to the expiration of the applicable time period described in section 3.02(A) of this agreement for identifying the account (or applying the presumption rules), unless the account is documented as held by a nonparticipating FFI.

Withholding Determination in General. A participating FFI that makes a withholdable payment is required to determine whether withholding under this section 4 applies at the time the withholdable payment is made by applying the requirements of §1. 1471-4(b) to determine the payee of the payment and to reliably associate the payment with valid documentation to establish the payee’s chapter 4 status. The exceptions to withholding described in §1.1471-2, including the exceptions for payments made under a grandfathered obligation and payments made to certain excepted accounts, apply for purposes of determining whether withholding is required under this section 4. A participating FFI is not required to withhold under this section 4 on payments made to an account holder of a preexisting account (including an entity account that is opened on or after July 1, 2014, and before January 1, 2015, that the FFI treats as a preexisting obligation under §1.1471-1(b)(104)(i)) prior to the expiration of the applicable time period described in section 3.02(A) of this agreement for identifying the account (or applying the presumption rules), unless the account is documented as held by a nonparticipating FFI.