[12393]
July 26, 2000
TO: BANK AND TRUST ADVISORY COMMITTEE No. 18-00
BROKER/DEALER ADVISORY COMMITTEE No. 15-00
OPERATIONS COMMITTEE No. 16-00
TAX COMMITTEE No. 31-00
TRANSFER AGENT ADVISORY COMMITTEE No. 34-00
RE: INSTITUTE COMMENTS ON REVISED FORM 1042-S FOR YEAR 2001 INFORMATION
REPORTING
The Institute has submitted the attached comment letter to the Internal Revenue Service regarding
the 2001 draft Form 1042-S which incorporates a number of changes affecting mutual fund shareholders.1
When finalized, this form will be used by withholding agents, including mutual funds, to report payments
of certain US source income (“reportable payments”) made to foreign persons during 2001 and any US
tax withheld from such reportable payments.
The Institute’s letter recommends that (1) US mutual funds continue to be allowed to report both
ordinary income dividends and capital gain dividends to the Internal Revenue Service (IRS) and
shareholders using a single copy of IRS Form 1042-S; (2) Form 1042-S retain the explanatory
information currently provided to shareholders and that the “Pro-rata basis reporting” and “Amount
reimbursed to recipient” boxes be relabeled as the “NQI pro-rata reporting” and “Refunds of overwithheld
amounts” boxes, respectively; and (3) the new requirement in box 14 for the withholding agent to
separately identify the type of US taxpayer identification number provided by a recipient (i.e., as a SSN
or ITIN, EIN or QI-EIN) be eliminated as redundant. With respect to the “Amount reimbursed to
recipient” box, the letter also requests that the IRS provide an example showing the intended use for this
box on the back of payee Form D.
Deanna J. Flores
Assistant Counsel
Attachment
Attachment (in .pdf format)
1 See Institute Memorandum to Bank and Trust Advisory Committee No. 16-00; Broker/Dealer Advisory Committee No. 14-00;
Operations Committee No. 15-00; Tax Committee No. 29-00; and Transfer Agent Advisory Committee No. 31-00, dated July 17,
2000.