To cancel its agreement, a Financial Institution (FI) must follow specific procedures outlined in various IRS documents. Here is a comprehensive explanation of the steps involved:
- Initiate Cancellation:
- The FI must initiate the cancellation process through the FATCA registration website. This can be done by selecting the agreement cancel link under Available Account Options on the home page. The FI will then have the option to either keep the registration agreement or cancel it by clicking the appropriate button.
- Effect of Cancellation:
- Once the FI cancels its registration agreement, the FI and any applicable branches will no longer be published on the FFI List, and their Global Intermediary Identification Numbers (GIINs) will no longer be valid. The FI will need to register again to obtain new GIINs if it wishes to re-enter into an agreement.
- Lead FI Specifics:
- A lead FI cannot cancel a member FI's registration agreement but can cancel its own. If a lead FI cancels its registration agreement, the lead and any applicable branches will no longer be published on the FFI List, and their GIINs will no longer be valid. The lead FI will need to register again to obtain new GIINs.
- Notice and Appeal:
- If the IRS issues a notice of termination, the FI has the option to appeal the determination within 90 days by sending a written notice explaining why the agreement should not be terminated. If the FI does not appeal within 90 days, the agreement will terminate on the date specified in the notice of termination.
- Compliance Requirements:
- Entities required to complete a Certification of Preexisting Accounts (COPA) or Periodic certification must submit the required certifications within six months of the cancellation.
- Automatic Termination:
- The agreement may also terminate automatically if the IRS discovers non-compliance, such as the lack of required documentation (Forms W-8 or W-9) during a compliance review. The automatic termination will be effective as of December 31 of the year in which the discovery is made.
By following these steps, an FI can effectively cancel its agreement with the IRS.
Sources:
Rev. Proc. 2017-21
Publication 5118 (07/2021)
Rev. Proc. 2017-16
Rev. Proc. 2021-19
Rev. Proc. 2014-47
Notice 2013-69
