§1474 Special rules

Summary

Makes people who must withhold tax under this chapter responsible for paying that tax and protects them from claims by payees for money they withheld. It says that, in general, rules for deciding if withheld tax caused an overpayment follow the same approach as under subchapter A of chapter 3. One exception covers payments where the beneficial owner is a foreign financial institution ("specified financial institution payment"). If that foreign financial institution is entitled to a lower treaty rate, any credit or refund is limited to the amount due from that lower rate and no interest is paid; if it is not entitled to a treaty reduction, no credit or refund is allowed. No credit or refund is allowed unless the beneficial owner gives the Secretary the information needed to tell if it is a United States owned foreign entity (see section 1471(d)(3)) and who its substantial U.S. owners are. Rules like section 3406(f) apply. The identity of a foreign financial institution that meets section 1471(b) is not treated as return information under section 6103. The Secretary must coordinate this chapter with other withholding rules so amounts are properly credited. Tax withheld under an agreement described in section 1471(b) is treated as tax withheld by a withholding agent under section 1471(a). The Secretary must write regulations or guidance needed to carry out and prevent avoidance of the chapter.