[Code of Federal Regulations]
[Title 26, Volume 13]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR]

[Page 218-219]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
Procedure and Administration--Table of Contents
 
Sec.  1.6041A-1  Returns regarding payments of remuneration for 
services and certain direct sales.

    (a) through (c) [Reserved]
    (d) Exceptions to return requirement. [Reserved]
    (1) and (2) [Reserved]

[[Page 219]]

    (3) Foreign transactions--(i) In general. No return shall be 
required under section 6041A with respect to payments described in this 
paragraph (d)(3).
    (A) Returns of information are not required for payments that a 
payor can, prior to payment, associate with documentation upon which it 
may rely to treat as made to a foreign beneficial owner in accordance 
with Sec.  1.1441-1(e)(1)(ii) or as made to a foreign payee in 
accordance with Sec.  1.6049-5(d)(1) or presumed to be made to a foreign 
payee under Sec.  1.6049-5(d)(2), (3), (4), or (5). However, such 
payments may be reportable under Sec.  1.1461-1(b) and (c). For purposes 
of this paragraph (d)(3)(i)(A), the provisions in Sec.  1.6049-5(c) 
(regarding rules applicable to documentation of foreign status and 
definition of U.S. payor and non-U.S. payor) shall apply. The provisions 
of Sec.  1.1441-1 shall apply by substituting the term payor for the 
term withholding agent.
    (B) Returns of information are not required for payments of 
remuneration for services from sources outside the United States 
(determined under the provisions of part I, subchapter N, chapter 1 of 
the Internal Revenue Code and the regulations under those provisions) if 
payments are made outside the United States by a non-U.S. payor or non 
U.S. middleman. For a definition of non U.S. payor or non-U.S. 
middleman, see Sec.  1.6049-5(c)(5). For circumstances in which a 
payment is considered to be made outside the United States, see Sec.  
1.6049-5(e).
    (C) Returns of information are not required under sections 6041 or 
6041A for amounts paid outside of the United States (within the meaning 
of Sec.  1.6049-5(e)) as remuneration for services as a direct seller 
(within the meaning of section 3508) performed outside of the United 
States or for sales described in section 6041A(b) made outside of the 
United States of consumer products for resale outside of the United 
States.
    (ii) Payor. The term payor has the same meaning as described in 
Sec.  1.6049-4(a)(2).
    (iii) Joint owners. Amounts paid to joint owners for which a 
certificate or documentation is required as a condition for being exempt 
from reporting under paragraph (d)(3)(i) of this section are presumed 
made to U.S. payees who are not exempt recipients if, prior to payment, 
the payor or middleman cannot reliably associate the payment either with 
a Form W-9 furnished by one of the joint owners in the manner required 
in Sec. Sec.  31.3406(d)-1 through 31.3406(d)-5 of this chapter, or with 
documentation described in paragraph (d)(3)(i)(A) of this section 
furnished by each joint owner upon which it can rely to treat each joint 
owner as a foreign payee or foreign beneficial owner.
    (iv) Conversion into United States dollars of amounts paid in 
foreign currency. For rules concerning foreign currency conversion, see 
Sec.  1.6049-4(d)(3)(i).
    (v) Effective date. The provisions of this paragraph (d)(3) apply to 
payments made after December 31, 2000.
    (e) [Reserved]
    (f) Statements to be furnished to persons with respect to whom 
information is required to be furnished--(1) [Reserved]
    (2) Time for furnishing statement. [Reserved]
    (3) Contents of statement. [Reserved]
    (g) [Reserved]
    (h) Cross-reference to penalties. For provisions relating to the 
penalty provided for failure to file timely a correct information return 
required under section 6041A(a) or (b), see Sec.  301.6721-1 of this 
chapter (Procedure and Administration Regulations). For provisions 
relating to the penalty provided for failure to furnish timely a correct 
payee statement required under section 6041A(e), see Sec.  301.6722-1 of 
this chapter. See Sec.  301.6724-1 of this chapter for the waiver of a 
penalty if the failure is due to reasonable cause and is not due to 
willful neglect.

[T.D. 8734, 62 FR 53474, Oct. 14, 1997, as amended by T.D. 8804, 63 FR 
72188, Dec. 31, 1998; T.D. 8856, 64 FR 73412, Dec. 30, 1999; T.D. 8881, 
65 FR 32205, May 22, 2000]