IRS 871(m) Tax Compliance Data
SIX delivers the critical data elements required to comply with IRS Section 871(m) and fulfill withholding and reporting obligations.
The US Internal Revenue Service regulation 871(m) is intended to ensure that non-US investors pay tax on dividends related to instruments that are linked to US equities. In-scope for withholding and reporting are transactions executed as of 1st of January 2017 in equity-linked derivative instruments with underlying US equity or those with “non-qualified Indices".
Determining which instruments are in-scope is a complex undertaking that requires extensive knowledge of the characteristics of equity-linked derivatives:
- Delta at issue
- Constituents, weighting and performance of indices with US equity components
- Continuous monitoring of dividend payments on the underlying equities
Are you prepared to identify all the in-scope securities in your portfolio?
If you aren’t confident that you can collect the necessary data and analyze the instruments in your database, then you're at risk of non-compliance with the new QI Agreement, effective 1.1.2017, which may result in hefty penalties.
> Answer these three questions to find out
Our IRS 871(m) data service
We determine which derivatives are in scope in accordance with their underlying instruments and indices, and flag for clear identification. Over time, our award-winning corporate actions monitoring provides data which is critical for tracking changes in the instrument lifecycle and determining the dividend-equivalent payments.