Your Foreign Financial Institution (FFI) has been sold or dissolved. You remember to cancel the FFI’s IRS FATCA portal registration. All done! After all, your FFI is a Reporting Model 1 FFI with no post -cancellation certification requirements. So, why is the IRS still indicating you are past due on certification?
Deregistration from the IRS FATCA portal requires that the Responsible Officer (RO) or authorized person access the FFI account and click on “Agreement – Cancel.” Reporting Model 1 FFIs do not actually enter into an FFI Agreement with the IRS. However, that is the appropriate button to click for cancellation of the FFI’s GIIN.
Beware! Once you click cancel and then the confirm button, your GIIN is gone and neither you nor the IRS can reinstate it.
Deregistered Entity Certification
The IRS requires that some but not all FFIs submit a Certification of Preexisting Account (COPA) or Periodic Certification within six months of deregistration. Reporting Model 1 FFIs are not required to do so but that does not stop the IRS from sending a message that “Periodic Certification is due” and “Certification of pre-existing accounts is due.”
A couple of additional clicks (before or after you click cancel) will turn the messages to: “Periodic certification is not required” and “Certification of pre-existing accounts is not required.”
While you are in the account, click “Periodic Certification” or “Certification of Preexisting Accounts.”
The next page is entitled “Financial Institution Certification – Classification.” Select the appropriate FATCA classification for your FFI – which in this case is “Reporting Institution under a Model 1 IGA.”
The title of the next page should be “Periodic Certification Not Required” or “Certification of Pre-existing Accounts Not Required.” and state:
“Based on your current classification and country of residence for tax purposes, you do not need to complete a periodic certification [certification of pre-existing accounts] for the certification period of [your FFI’s specific certification period].
If you were in a classification or country of residence for tax purposes during the certification period that requires you to complete a periodic certification, you can still submit a certification.
Do you want to submit a certification?”
The general answer here is No unless you have a particular reason to opt to submit a certification.
Access to Deleted Accounts
If you have already cancelled the FFI’s account, it is possible to access the account to engage in the steps outlined above. It is also possible to submit certifications for FFIs that are required to do so within the mandatory six months of account cancellation.
To access the account enter the FATCA ID originally assigned by the IRS to the entity and the account access code / password you previously created for the account.
For those FFIs that are required to submit certification, it is critical to complete the certifications by the IRS deadlines. This is especially true because access to the account is available for a limited time.
Additional Blog Posts on Deregistration
FATCA & CRS: Don’t Forget to Deregister July 25, 2017: https://bit.ly/2tWY6Dm
FATCA: Mandatory Certification for GIIN Deregistration September 10, 2018: https://bit.ly/2O7jlgq
FATCA: Some Deregistered Entities Need not Certify October 29, 2018: https://bit.ly/2PuuTyr
FATCA: Deregister Now & Avoid 2020 Reporting December 20, 2018: https://bit.ly/2Lur6wC
For additional blog posts, please go to my website: elizabethmcmorrowlaw.com