August 16, 2012

TO: Distribution

FROM: Burt, Staples & Maner, LLP

RE: Draft Form W-8IMY Raises Many Questions; New Form W-8ECI Also Released

The IRS has released draft versions of Forms W-8IMY and W-8ECI. Although the drafts are roughly what we expected, the IMY form includes a number of new features and as-yet unexplained items. Suffice it to say, the form is both revealing and, largely due to the lack of instructions, difficult to penetrate at the same time.

The most noticeable feature of the new ECI form is the elimination of the line for the signer's "capacity," which often caused arguments on audit over whether a particular title was sufficient. For example, "tax director" might be permitted, but "director" might not. in place of the capacity line is a simple checkbox where the signer certifies that he or she has the capacity to sign the form. While this checkbox is unnecessary - the signature itself should be sufficient proof that the signer is authorized to sign, and what does the checkbox really add? - it is a welcome evolution.

Rather than list our observations about the design and content of the forms in our ususal client letter format, we thought it would be more useful to share marked-up versions of the forms with our comments included.

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