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hi this is anthony parent of iris medics and maybe you received a form w8b e and e and you are wondering what to do with it well this video we are gonna help you figure out what it is joining me today is my great friend Ryan so cash host of Kult America in a media sensation Europe and and potentially around the world pretty soon hi Ryan how you doing but hello Anthony I am also the grande filler of forms w8n II recently so I'm really excited to probe your mind about this write us you have you you asked me I was like oh my god I have to do this because Ryan just renounced his citizenship and now this is a form instead of the w-9 he has to form a w8b and B and E and so he asked me about it and it is you know it it's just one of those things I look at this form and it's so crazy complicated I don't think about it too much then when your friend is asking you about the form you realize wait a second this is a little bit much and especially now here's the thing Ryan you were a u.s. person for tax purposes and now you're not exactly know so imagine put yourself in the shoes of somebody who's never been a u.s. tax person runs a business overseas gets this form from a US customers thinking what in the world is this well I think even most American people wouldn't know about this form and the the first reaction I had because of course you know making that transition from being a US citizen to returning to your ancestral heritage and taking on that nationality that's weird enough in it of itself but then relearning how to engage with everyone you knew back home and the companies you knew back home in the States from a tax perspective is also a whole of their take and I think because I went through that unusual process I might see this form this particular form as more of a positive than a negative but right yeah you know what I mean because I I really for all intensive purposes I really see this as almost like a wild card for corporations that want to who provides services in the United States or be a part of the amazing economy that's there but I think my reaction to it is very very unique because if you don't write and you've seen the alternative of us compliance for a shareholder of foreign corporation so you know what that is and so yeah you might be looking at this form WAB a and e saying actually that's a lot easier than the floor 5470 one well yeah yes so right I guess you know in a way you're right you're absolutely right about that that is absolutely correct but then again I think there are very very very few people who have made that transition on the other hand there are hundreds of thousands of entrepreneurs all over the world that could be a part of the economy partially by learning this form and let me tell you where I came into contact with it okay and time again actually with stock video and photography platforms so it's it's a little thing it's an abstract thing but imagine you are photographers in a montag refer or an artist and you would like to sell your work to platforms so that they could be used in a commercial capacity well this form if you're a corporate entity enables you to do just that and it's it's critical because every country has a different tax treaty with the United States which we'll get into later but that really allows you as an individual well that would be with w-8 been or as a corporation with W and E to take advantage of that treaty that's in place so Anthony why don't you give us a bit of the background on this point and an overview and let's just go through it fill it out so here's the thing this is what you need to know if you are a person let's say you are the person that Ryan just described your your your an artist your your photographer and you're in Australia and you have US customers that want to buy your prints and here it is they send you a form wate any so why did they send this to you well here's the thing as a non-us person if someone sends you a payment you're foreign the default rule is there's a 30 percent tax rate on the payments they send to you now the thing is the iris knows that you're overseas of collecting from you is kind of impossible so what they did they do they impose a withholding requirement of 30% on the person paying you so that means the person paying you if you don't fill out this form and they think you're required to do so is going to likely hold back that 30% and just give you this the 70% they all know what's that they play it safe they play safe because here's the thing if the IRS examines them in the US and says okay let's take a look at all the people you've paid you say oh yeah here's all their expenses I have they line up so go who's that person Australia oh it's a fantastic photographer it's okay okay well did you do you have can I take a look at your circle you APN for that purpose B&E for that person or for that edge persons entity actually in this case it's not the person the BN is actually when your individual let's say you own that entity and that's what we're talking about in this case and if they and if the person being exempt so I don't have then the irises well let's tell you what we're gonna do we're gonna treat that payment you made as actually who's your profits something that's going to be taxed upon so the person sending of this money this is how the IRS has done it so they can be assured that they are going to be paid taxes that are due to it is they use the person they use the person that's in the US that they have access to as the leverage and that's why you see a lot of withholding that's why banks will with holds for FATCA is you're not cirfairy cuz the bank the IRS can the government can the US government can leverage those banks way too many individuals to go after you could so so as a corporation in the States doing business with people abroad or using foreign entities as service providers content providers you could fall upon dark times if you don't secure this form so it's I think like when you're dealing with US companies as a foreigner you really should take this form seriously because they it enables you to have this get a great opportunity it's for the well-being of the person providing you a job right you know and you know what Thank You Ryan for bringing that tone to this video because as I'm talking about it I'm sort of describing this as a terrible form but no no it is actually a good form now it's good they are sending you this because they want to pay you right that's how serious they are about doing business with you they want to pay you and they want to be in compliance with you so when you do receive one of these this is good that means they want to do business with you you earn so it's a complicated form but that's what we're here for right we're gonna kind of go through it and figure out what it is and what you're really you know I think the thing is what are you really signing right you get this formula mmm okay should I sign it I have no idea what it means well you know that's what we're here to do today is to give you an idea of what the form is what you're signing and some of the information that you're going to put in it let me see if Anthony are you able to see my screen I could see your screen and I have a form of it as well so yep I can see it so yeah we can follow along yeah let's I mean yeah definitely so yeah this is a little bit longer we have another video on form wate n okay so that is if you're an individual and that's actually so let's go through the top of this form so it says do not use this form for a u.s. entity or u.s. citizen or resident and he says instead use form w-9 and that's what you used to use right we are and then if you're a foreign individual we have the be en without the e that one that we talked about well do we have video on that and then here's some other things to foreign individuals entities claiming any income is effectively can up did with the conduct a trade or business within the US and less claiming treaty benefits because we have a different line for that if you are claiming treaty benefits afford a partnership for in simple trust or foreign grantor trust I would say this I could go through all these but I'm let us say this for the person who is that photographer 99.99% of the time we are just really talking about that entity right I'm not gonna be worrying this is the form for the entity if you have actually a foreign government international organization well you probably have a whole tax team doing charities for you so yeah for the person who's likely unsupported in this situation so you're likely it's just going to be this form there are other ones to do there but this is really probably if you do own some sort of entity overseas and let me just point out that normally when you're looking at tax forms and it says do not use this form and you qualify as one of those things it's great news actually oh yeah I'm not yeah I'm not yes it here yes what yeah you know I'm gonna go out on a limb and guess that you'd almost prefer to qualify for using this form than end up in the scenarios with the the other people see the other ones are complicated but again those are four entities that are so sophisticated they're gonna have a team that to be able to handle for that I just really couldn't imagine a lot of these things you know it's just something that you don't accidentally create or you know but certainly you know creating an entity in your country then do you own business with Americans it's incredibly common right tell me about part one Anthony so here we are we have this thing called beneficial owner and that might be the first word that throws you off your what does that mean so identification of beneficial owner basically it means you you are the owner of this entity that things go through here and it's a way to sort of say that they will really want to know where it ultimately flows to whatever the income is because you people can use proxies and shells and all those games and do layers layers layers but really they just want to know hey look where does it ultimately go to so here it is the organization that's the beneficial owner but not the shareholders of the organization because that's flowing back a little bit too far that would be if them say huh yeah so my LLC is the beneficial owner not the mother company not not primary shareholders just the entity in and of itself right for the be any correct okay interesting country of incorporation or organization that's pretty straightforward that's where your tax resident I'm assuming yeah we're we're it was formed I mean that's usually where you are but sometimes there's reasons why I know a lot of guys are doing Malta right now oh yeah that's going on there's a lot of Malta has some really interesting things going on time and so that it could be different there and then if it is now we have a whole section on disregarded entities so assuming that that's what we got to talk about because man I want to go right by that Pat no no no I'm sorry because filled out this form yep let me be transparent you know I like honesty yeah I I have really haven't been able to deduct what that means and I suppose that 99.9% of people who fill this out my accountants included actually don't know what the disregarded entity is that people abroad so can you break it down maybe and you know Forrest Gump style so that we all understand Forrest Gump's I was gonna be hard why don't I do this why don't I do I'll read you this section okay okay because it is really this precision way then maybe you could ask a question it's like Forrest Gump had an IQ of like 50 so I don't know if like I don't know about that I think he's a little smarter than that he seemed to be pretty effective alright so you are a disregarded entity branch or flow through entity for US tax purposes however you may use this form if you are disregarded entity or flows through entity using this form either solely to document your chapter four status because you hold an account with an F F F I okay so chapter four is we talk about FATCA okay chapter four we see that that means FATCA I had a lot of questions about that as well oh god yeah so of course they don't tell you that so it's something where you're you're under FATCA and you are disregarded entity and you're looking to claim treaty benefits okay so is this like if you are actually bound to US tax law in the first place benefits and I'm gonna be honest I have never filled out one of these where I put in something in that form so I'm trying to figure this out on my own too because here's the thing disregarded entity is a term of art that we use for US tax code okay so when you put a name of disregarded entity receiving the payment if applicable see instructions the first thing I think of is well that's gotta be a u.s. na us recognized entity and you can only have a district well there's two ways to have a disregarded entity oh actually you know what there's two ways they made a check the box election and that's what it is if you made a check the box election uh we know that wouldn't make any sense because I checked the box elections only if you're a u.s. person we're already saying your non-us person so this one's really got me I'm trying to think of the situation where this does pop up and I think what it is is disregarded entity in this case is not the term of art they're actually talking about a disregarded entity in another jurisdiction that's what that's my only conclusion that I could reach honest that's in order for to make this sentence well thanks our identity that is where the taxes flow through to the individuals that's about the only situation I could think of and maybe some of our viewers and we got some pretty smart people who are maybe they have a better idea if they could leave that in the comment will pin that comment if somebody has an idea of what that is so that people could watch in that video this video will know that so yeah that's this one's got me a little stumped I would really I haven't run into it and it's just sort of at odds because you do have that term of art yeah well thank God it says if applicable because maybe there's a chance you don't have to fill it out where is this number for just one well and I think the thing is if you just listen to me I had a hard time answering that question right no I know there's tax pros around could you know that question like yeah oh it's this so the thing is if you were probably having a disregarded entity you have your you probably have someone there already doing this yeah that's a story that I would say most people that's not gonna apply yeah now the chapter 3 in chapter 4 status this is this is where the w8 bene starts to take form in my area this is where I think it's a little bit tricky so just tell us what is chapter 3 and chapter 4 status what does that mean so okay so we're gonna have a whole bunch of so chapter 3 status is sort of factor right so chapter 3 chapter 4 those are both FATCA yeah chapter 3 is factor I believe or 4 and 5 so these are the four so this is complying with the law to say okay so our status is what are you okay okay and then oh yeah so there's there are do they are slightly different then you see chapter 4 is actually the fact that's right I'm George just your status in chapter 3 is not your faculty status chapter 4 is your FAC assessed so that's why we have these two separate parts if FATCA was never law we wouldn't have this box 5 yeah there'd be no reason for it but fatzke the foreign account Tax Compliance Act was passed in 2010 creating this boom look at that look at how look how much complications that's just added for this first page of the form because we'll get to the other parts where they references yes and you know what's crazy about this anthony is someone who filled out this form several times ok chapter 3 status it's really straightforward you can easily align your entity type here everything is pretty much covered I constitute a corporation right yep but part 5 so chapter 4 status this is where it gets a little bit nasty because from what I read online and please correct me if I'm wrong about this when you're talking about chapter 4 you're dealing with entities that should be governed by FATCA is that correct well right yeah chapter 4 is FATCA right exactly right now let me tell you my corporation is not obliged to facta yet I have had this form returned by the attorneys of some of the companies that I work with yes that you need obviously I know one could tell me yeah I think you're right I think you are right we're going to go through this so we're gonna find out if you are right or if they are right my suspicion is you are correct so let's see about that so yeah I think the first part is pretty easy you know which one you are there it's gonna be corporation right um for motor insurance now it would say this what would now wait a second I read right into a problem right away where's LLC ya know where is it not here I don't know maybe there is it maybe they used it up on 54 71 that is actually rather force well the answer is and this is this is what I have not I would double check on this my suspicion is it is corporation because the IRS treats all when we're dealing with with with foreign LLC's the IRS by default treats them as corporations because there are limited liability status I see no reason why there would be a different at death different definition for it the only difference would be here it is if you do have that disregarded entity and that's just that is you know now I think it becomes clear that when they're talking about disregarded entity they're not talking about a disregarded entity for us traditional tax purposes that check the Box election they're talking about an entity you are disregarding in you your country now that's really what right well when you get to the chapter four it gets crazy because you're like look I'm not I'm not in FATCA I'm not covered by and yet the closest answer I find here is a count that's not a financial account which in and of itself doesn't make a whole lot of straightforward sense to someone who's not right because you're not on that count your corporation is not an account it's a corporate it's an entity because I know that's that's not the word they do they are not synonyms in any sort of way so you know I think I think we should go through the instructions now to see we could see if don't have is smarter than a team of attorneys on this I think I'm like the yeah like you know the lawyer equivalent to that guy that hand him an you call him to fix something in your house he just kicks it just yeah and maybe it starts working maybe it doesn't so I think so let's go so so we know chapter four is all right so we're going through these so I am on this section right and boy it gets a little busy here so we are gonna bring it use the big words let's let's hear you do okay so chapter so sponsored SSI right so here's you know this this form is so loaded with acronyms it's incredibly nuts right so let's get to the first one and that is which one you're going to alright so we have the part of Oh waitron form there let me get to this is almost other word or acronyms then yes so put a non-participating SSI including an SFI related to a recording i GA f fi other than a deemed compliant fi fi participating f fi or exempt beneficial well right here we're just going to knock this out I'm not going to get into this but you are not a foreign financial institution if I see FF I anywhere I know this is not you so let's get rid of that box the next box participating FFI reporting model f fi and a lot of fi okay we're we're getting rid of okay any FF i we are done with okay so that gets us to a cert certified deemed compliant sponsored closely-held investment vehicle I'm not an investment no that's not you um certified Dean compliant sponsored clothes we had serif ID compliant limited life debt investment entity are you one of those right definitely not me know assertive certain investment entities that do not maintain financial accounts which you say you're an investment entity at all I would say most people are not investment right yes we wish we wish we were right I think that's our hope some day owner documented FF I will get rid of FF I know you're not what you're not one which is good shows it means I don't have to do part ten right surely so restricted distributors so there's one what the heck is that what you're not a distributor but maybe we should just double check on that one CEO Anthony I almost feel like they need instructions for the instructions sometimes because because ok ridiculous well if this is really ridiculous because you want to know what a restrictive restricted distributed it distributors yeah yeah if you are a restricted just reader you must check the box are certified that you meet all the requirements for the status that's it you could have italics about what they can't do but there's actually no definition of what a restricted distribute is we don't know I I guess it's not be I guess that's not me because I don't know is their certificate to get your restricted distributor euro is there may be a form for that right and that just point one thing out fortunately foreigner filling this out who are not bound to the legal ramifications of the document too much it's it's crazy because ignorance of the law is not argument for violating the law right and the instruction form doesn't even define these chapters that's crazy that is you know the context for the for the you know person who's not familiar with you know you know we mentioned this in the other video but the art you know that think of the IRS as intense as the US military you know that's really sort of appropriate that intense I would just say the US military's probably a little bit more effective with your sources and probably a little bit more like to you the iris is not really all that terribly well like I like them well I mean iris employees are always you know incredibly helpful to me the organization I don't like the employees of course because what other countries tax law could you really have this enlightening of a converse mean this is this is like watching a freaking action movie or something this is so right it's it's okay what do you know here's you know here I just thought of this is analogy English is one of the most powerful languages because one of things that we do you know as first it's based on two things you know we merged French and German you know in France French is good for your nuance and German is great for you know your country language and so it gives us power but then English also incorporates everything else from the world we're into it and you know that's actually what the US income tax code every idea around the world I've had attack something usually you'll find it in the code so if you can understand a US tax code you can understand any country's tax code and really quickly to yeah it's not even and here's and this is really one of the big differences too because other countries are interested in raising revenue so they make their tax code very easy to understand the United States we're interested in making our tax code responsible for setting our public policy so therefore it is the most complicated thing in the world because it's doing some think it just can't do its you're trying to control human behavior with your tax code and this is what we end up with and you know as as is very well demonstrated by this quote-unquote simple form simple form right this is so we're you know here is fatty here so now we've decided you're not a restricted distributed we've decide are you a non reporting iga FFI well we're getting rid of that you're not an FF i know are you foreign government nope that'd be funny to see a foreign come down and fill this form out I wonder if that actually happens are you an international organization I think we should go to that I think we should check that out that definition because Andrew you are right I mean you are ok sure I'm a part of one ok that's for sure now unfortunately we do have to go to a session I feel like they're talking about financial institutions here I mean everything else here has dealt so strictly with investment accounting it's feels pretty far removed from yeah doesn't really sound like yet so so it is so they do define what it means to be a if they do define what it means to be let me just grab this up here what it means to be an organization and let me just know this is this was the suspend yeah it's just not definitions us code we are going to and I'm pretty sure we're gonna find that and it's funny because we're having a bit of a laugh right now but I bet you that some people fill out this form they're not laughing very much because they'll never figure out what any of this means okay so we do have international organization international organization means a public international organization entitled to enjoy privileges exemptions and immunities as an international organization under the international organizations immunity Act I don't think that's me right but I guess we actually well let's go to the org is it yeah so I would say you're not yeah we will not be close that was a closest one right I know right if you're not familiar with what our words mean you know what an organization is like well that and I'm organized right because the format you wear you organized yeah well here well that must be and I'm an internist so I would say that's probably the most common that has to be the most common wrong thing people put down because that's pretty misleading so let's get the next one exempt retirement plans okay that one's funny okay let's go on entity wholly owned by exempt beneficial owners entity wholly owned by exempt beneficial owners well okay maybe that's that could be it that's interesting because that sounds like it to tell you the truth because that is you because everybody in your entity team there's nobody every beneficial owner of your entity all right let's check out part 16 all right part 16 maybe that's it and maybe uh maybe your guys were right all right do they have that in the instructions out of here yes so if you are an entity wholly owned by exempt beneficial owners yeah you must check the box to certify that you meet all the requirements for this status you must also provide the owner documentation described in this line establishing that each of your direct owners are dead holders an exempt beneficial owner described in regulation sections one point one four seven one - 6 B why would you want to look at the regulations because I'm thinking that's it I mean as long as we're this far down the rabbit hole yes so this is so that is if you so I'm trying to think if there's anything here that that I'm sort of having questions about you are an entity wholly owned by exempt beneficial owners well that's the part there what do they mean by exempt beneficial owners because yeah that yeah I think I'm thinking that's what it is wouldn't that imply that the owners are exempt from the bounds of FATCA well right well that right there is exempt exempt from what exactly and let me ask you this Anthony I seem to remember you made a very good video on this channel about when a non-us corporation and forgive me if I if I'm getting this wrong purchases majority stake in the u.s. corporation don't the other entities they owned suddenly become bound Yeah right exactly that's called downward attribution where what interest can spring a whole bunch of other things have a video on that downward attribution now there is some relief available if that does happen it really ends it's people who it actually could be someone who's in this situation if you know and actually this is sort of how people find out about a lot of their non-compliance let's say that you are receiving payments you are you are four important person and you're receiving page you get this form w/e pin oh yeah better fill that out well here's the thing too in case you don't know if you have a if you own an LLC in the US as well because sometimes you might have a LLC in the US because you have might have us US clients who will say oh look I want to go I want it to flow through the to the LLC they don't want it they don't want an um they don't want a foreign payer they want someone internal to the in the u.s. they could they can send in 1099 to so you open a domestic LLC for your clients to send you stuff well if you did that you have a form 50 472 obligation as well and you might not and you probably don't owe any taxes if it's not us first income but you have that form and there's a really big penalty for not filing it and the thing is is the IRS does have leverage over you because you have they have the people in the US are paying you and you don't want them to go ahead and levy payments that are coming to you it's also very embarrassing to that's just something to be aware of if you do get this and you because that's a such a common thing for our clients is they have both they actually do have yep some people pay me overseas because they don't care they already have the the the the comply scene but some of our smaller clients they want to they they want to get in compliance sorry just got a little distracted got it got a mess no no I mean this is this is all pretty exciting just because it's again it's a sin perform but you might even be ignorant of your shareholders activities elsewhere but as far as it seems if they own an LLC in the United States then the beneficial owner might not be so exempt for now okay now I'm actually ruined grace right so here it is now about the regulation No No maybe I'm gonna swing back your way all right so this is so here we are this is in the regulation that I mentioned oh I don't wanna lose my so let me read it that I'll tell you where it entities wholly owned by exempt beneficial owners person is described in this paragraph G if it is an F F I would stop right there we stop right there okay because not an F F I anymore so a person is described in this paragraph G if it is an F F I solely because it is an investment entity each direct holder of an equity interest in the investment entity is it exempt beneficial under described paragraphs b c d e f or g of this section okay subscribing one's own self its reefer i love it the paragraph is referring to itself paragraphs refer to itself in a third person i like how do you die in red the color red is red i think really we do stop there yeah you are not an SF your entity is just not a foreign financial institution you can't get there yeah it seems we're stopped there a look if people have another idea please if you disagree i just don't see it I don't see how it is so okay so score Ryan is still I think you know it will raise the view sacred doubt what I thought was gonna bring it down a week we're not still up yeah and then we got close break but 16 does not apply to me that's 18 right that's yeah I need to find out which frickin checkbox I'm supposed to fill out because sometimes lawyers will not accept this form a bright you're trying to answer this question as we okay all right let's keep it going this is it okay a territorial financial institution for sure no we're gonna say now it's accepted non-financial group entity okay good we got a look at that don't really want to look at that that sounds horrible but we got a look at that and add something okay for those of us who don't read Roman numerals look at what section is that okay you want to know you want to know the definition yeah okay here's one accepted non-financial group entity if you are an accepted non-financial group entity you must check the bots to certify that you meet all the requirements for this status this is nuts it's funny because that you know I've sat on this floor I spend so much time on this form but it's like I never analyzed it I never really thought about him when he break it down this is the whole new tautology this is a tautology when you defy your definition by your definition that is a tautology so we have no other reference point to go to all the way can you define the word computer' Anthony look a computer is a word right that that a computer as a computer I can't do it it's like it's too hard Wow then there's reality and doesn't CC anywhere else you're really stuck with the general instructions there's nowhere else to go I can look at let me let me see if I could find it in the regs they don't rep they don't reference the Reg but let me see if I could find it um nope I don't know maybe they just copy and paste it a bunch of crap onto this for my salad date they just said hey yeah the word non-financial let me I'm just gonna see the word non fine shows up in the rags and the word non-financial does not show up in the regulation so if you are looking to find out what a non-financial form is you will not find it but think about the IRS regulations I don't believe you'll find it and I think it would probably be in the IG no but chapter four I don't get it yeah there I mean look if you don't give the definition away and you've got all these boxes that someone has to check to put in the form then all of a sudden the u.s. corporation is sitting with a little time bomb you know just in case yeah iris wants to dig into them and they look at the the W a penny and say hey wait no hold on this is this is not a sponsored FF I the guy filled it out wrong so oh I'm sorry you know we looked for the definition but it wasn't there and like we just tried to deduct to the closest applicable option here sorry man now you're headed for audit you're gonna be you know what I don't know maybe it's something like that well you see this is like if I was gonna you I'd like take it here maybe we'll have a scholarship one day this is what I have a challenge anyone out there find out what this is find out what a exempted non-financial group entity actually is and because you're like well well how would you go about this because it doesn't really this it seems to be the instructions and I would imagine there's some where in fact it would be there but it just isn't defined and you know imagine trying to call the IRS to get any answer to this one I was actually you read my mind because I was thinking maybe we should just call and ask because you could never get an answer from the IRS about what this is you would that's and I think that would be the challenge it's not notice I don't wanna I don't want a paper on what it is I want someone in this world to be able to figure out how to get an answer on this from the IRS now the only way I could actually think of is maybe getting a private letter ruling but that could be like eight thousand dollars to get that we should start a crowdfunding crowdfunding I know what this is just actually everyone subscribed to IRS medic right now because we might have to do that down the road I think this is not going to be the end there's gonna be part two of F a I'm sorry have formed w8 bene because it this this is what I also think about the massive amount of government resources we could waste attempting to answer this question we can have that we could have you know a national sensation we're just trying to figure this out get everyone involved everyone investigate yeah what is this what is this that's pretty interesting alright keep it going but maybe my I'm still so let's go to part nineteen exempted non-financial start-up company okay if you are an accepted non-financial starting a company you must check the box to certify that you meet all the requirements for the status what are the requirements you must also provide the date you were formed or your board passed a resolution or equivalent measure approving a new line of business which cannot be that of a financial institution or passive an F F II okay now so so where does that now that that right there is the first time I think we mentioned an SS II because that's part of our and I'm curious about one thing so if you're providing I don't know Chinese board resolutions you have to translate them and attach it to this document or it just says the date you don't need to I guess you know you don't need to certified your board venture oh sorry you just need two days you just needed the date okay but even though again and I think that's what we're you know we're basically you know we're we are sort of stuck there um that we don't know what this is we you know we just don't know what's the difference between a start-up and the non startup because tell me what the date is because it says okay you're a startup okay well how old do I have to be to be a startup or how does that mean and why would why would I be a startup over a non financial group entity I'm not sure because both of them are about equally vague one startup one says doesn't so I guess hey we want to be a start-up for more you know it maybe it sounds cooler to your friends there's a anywhere startup by we did have had a client great guy he opened a Swiss bank account soul for the reason while being able to tell girls yet a Swiss bank account and that's cool yeah he's like you know what never really cost him because they weren't you know he had to get in compliance with the streamline program music God didn't make any money and is a really really fun guy that I thought I thought that was a great just to say I had a Swiss bank account that the Swiss should almost do that as like a way to earn money like get your own Swiss bank accounts open it online took a lot of the fun out of that huh now this one oh you know when I saw you know I look at this form you run through this and then you're really you get really really thrown off by this one okay so part 21 501 C organization and you're thinking there so my first think okay well this is for foreign entities correct yeah 501 C is for a non-stock corporation that's a non-profit that's in the US and trying to sort of figure this out oh how is a foreign entity and somebody maybe I'm just being silly on this I don't see it now is this a foreign entity that's not organized as a 501 C under US law viii 501 can be a 501 C that's what I want to know how maybe and I'm thinking maybe this is some sort of an advanced level NGO and maybe some of our you know I would just say whatever it is it's gotta be something related to it's there for a reason and I would say it's probably latest with some very high sophisticated 501 C's not the ones we would have anything to do with the kind of big business you know American Red Cross big ones like that maybe that's something that they deal with because they have a I don't yeah they don't think I'm you know I'm starting to think maybe because once you well this is what I don't get if you're a 501 C organization we go up to the top of this form you are we go up to the top of the be e and E it says do not use this form for a u.s. entity or us resident citizen resident a 501 C is a u.s. entity it's nothing else so I get got me here guys you got me yeah I'm really stumped that's crazy please help me please okay a nonprofit organization that seems pretty straightforward doesn't yeah that's right that's the that's not what you're after yeah and then we were have publicly-traded nope we stopped from there whatever that is we don't have to stop publicly-traded no no this is for that's not yet accepted it was that the next one accepted territory and SFC non-financial foreign entities you okay you want yeah if okay so we do have regulations for this okay for the if you are an accepted territory and ffe you must check the box to certify you meet all the requires for this classification okay so let's go to the regs on this one let's see if we can find this would be fun if they're not here but let's see here oh of course that's going to be there I am in 147 six but just double-check ah of course they would they would never 141 okay I'm not in the right code section okay yeah all right that's why is that showing up let me grab that they're so helpful they have it all over the place because a and you know it's like you they oh by the way this is something that's kind of funny Eve that just as an aside you know one of the things that uh that's all you know you'd you're IRS medic the channel is always good for is a lot of tax protesters like to say hey there is no tax code there's no law that says you have to pay taxes you know it's just one of these things that people say it store drives you nuts but actually in a way they're right you know that I thought about that there is no tax code on irs.gov you will not find any tax code on irs.gov you will not find the only place you will find the US tax code on a.gov I believe the House Republicans have a version and there's another version but we all go to Cornell Law School's for the tax code isn't that we have like the world's worst tax code and the IRS won't own it own up to it they don't even I want it on their website so this is so domineering I mean this is a form that's not even for US citizens by the way yeah think about that thank you think about this we're like in the freaking first part of the form right now we've been talking about it for an hour and this is not even for US citizens yes okay so we're looking for accepted territory n FF e in regular Treasury regulations one point one four seven two - one C one part three okay let's see where that is okay so I'm putting in find okay nothing coming up on that let me just respected territory let me see what happened nothing is happening let me see here okay see why I might have a misspelling let's see where this pops up okay folks okay all right I'm here I'm on the page I'm a Treasury section one point one four seven 2-1 going down and it says section three right needs section three keep going keep going keep going keep going section three and there's a lot of little numbers you got to keep track of because it's so he's so helpful section 3 section 3 well is it a little lovely yeah they don't help you out too much here c-13 cccc it's so fun to scroll through regulations to find what you're looking for and then yes I would just say this when I do put the phrase accepted territory into the exact regulation there's nothing that comes up what I can see is that if someone wanted to be really thorough about this form you might even have to retain an attorney to actually sit down and figure this out right it's ya know in it there's actually nothing here that there's nothing here related to accepted territory so the instructions to find a term of art they define and it's a term of our accepted territory and FF II however that term of our is no where to be found in the instructions in the regulations amazing so we are looking for the deficit it says look see it's it's just not here there's nothing that says accepted territory at all there's that you don't find it there's no combination of that you think you have a list right there in the instructions for you Oh hold on I did find it hold on I did find it now why what did okay cuz it's what they do here I did find I'm gonna kill him the definition accepted n FF II the term n FF II means n FF e that is described at one point one four seven two one L see one okay oh that's kind of what we're looking for there right yeah yeah that's uh I really am yeah it's an awful lot of redirecting and c1 okay this is the only this is where it is a withholding agent is not required to withhold under Section than a section with holdable payment to pay is that it is an accepted and FF II okay now we felt this is this is this is where it's defined this is the paragraph where they're saying the phrase is defined okay okay here it is we found it I'm ready for accepted and FF II means a payee that the withholding agent may treat as an NFA II that is a Qi WP or WT additionally the term excepted nfe means with respect to the payment and a nffa describes in paragraph c1 1 through 7 of this section to the extent of the withholding agent may treat the NFF e as the beneficial owner of the payment okay now it's all clear great sorry I think that before now I get it thank you very much alright yeah that doesn't apply to me so there are so many layered nested z' of acronyms in there that yeah we would never finish this but we could just say that's not you yeah that's it well we'll just say Ryan that's not you and that's not going to be our people you're just losing I'm losing hope I don't even know if there's a sense to finish the remaining PE that isn't accepted nfe so you have to be an accepted nfe Athey means that payee death the withholding agent may treat as an NFA II that is a Qi let's find out what a Qi is qualified it to be your job okay do ya but they could also use we hold on a few key means withholding for in partnership or withholding foreign trust so you have to be sounds like you have to be one of those three things in order to be an accepted and FFT you need to be a qualified intermediary or a withholding foreign partnership or trust that's what it sounds like to me so we could say it's not you yeah alright we're moving on Wow all right that's a little bit of time that was a little bit yeah so let's see here and I think maybe we don't need to go as deep in just because I mean these are just kidding so now we're I was getting to edit I think I think we've made our point I'm gonna fee but the last one is actually the one that fascinates me the most destr probably feel most inclined to tick because it it just feels benign like an ago well that is not a financial account so let's go first but no we're talking about a corporation here I already said in Chapter three I'm a corporation not an account so no I dunno no we know this the IRS loves a wide interpretation of what account is but they lost the case in the Ninth Circuit the IRS tried to impose f bar penalties on somebody who had a brokerage account for I think online gambling and they said well that's that's a bank account and that's nice Kirsten no no no you know what a bank account is a bank account that's what a bank account when you go to a bank that's a bank account and it's actually a pretty good ruling that's homme that's really one of the only favorable things so yeah sure the IRS loves to say everything in the world is an accountant actually that's what you are to the IRS you have an account each year you have an account you ask for your account transcript so that is kind of account is also a term of art but do they mean it here so let's try to see if we could figure this out because yeah if I get it right Google search that phrase account if this is an account that is not in a financial account there's no part to complete it doesn't say complete part just says okay just just say it alright so really where we need to go is I want to go to the instructions first to say okay well what do you mean here because it doesn't even refer to any part of the instructions about what it means by by that what do you mean by account and actually you know I will put that phrase right into the instructions to see yeah we got it if you are providing this form to document an account you hold with a foreign financial institution that is not a financial account under regulation sections one point one four 7-5 be to check the account is not a financial account okay so we have to define what they mean by its this is only if you have an account with someone with a with a foreign financial institution that doesn't is not considered a financial account under the regulation so now let's go to there okay and I think we're gonna I think we're taking I think we are getting to the end you Ryan this is the last one so if it's not here I'm gonna put I'm gonna chalk up that victory to you my friend let's see here cuz it's not looking good for your attorneys right yeah I've got to tell you that guys I told them maybe said it sounds like we're going through it here you got you got it you know and I think people get so afraid of the IRS that the normal thing is to go overboard oh just do something do something because they're not really looking at and people are afraid you don't know you know what it means and again the best ik American lawyers they don't know about any of this because they do not deal with it in an ongoing basis like you guys do so it's manin we do this all time there's so many little trips oh okay so here we are at the appropriate regulation I'm gonna put in the exact phrase account it's not a financial that is not a financial account that does not come up there is no exact match for that phrase let me try to narrow that down I'm gonna narrow it down a financial account limit it's gonna pop up a lot of things but let's see if we can find it that way because again there's nothing it's not referring to any section in the regulations yeah so we're just sort of trying to figure out where they did this okay all right so it's definition of us account we're not talking about a user's account so we can just skip that right yeah they're definitely not okay so that that section just can't apply let's see the next okay doesn't apply okay account holder here we are in cow holder the account holder is a person listed or identified as a holder or owner of the account okay where we're looking for account what do you mean by account okay so if you're about I found it's 171 5b that's where we need to go 5b has our answer right according is 5b that's for B is it 4b 5b 5b we're gonna get our answer right we're not gonna the IRS is not gonna deal make it joke in mock us with something so dense and absurd right it's gonna be we're gonna have a very clear yes right we're ever holding out hope you're not savvy example go and go and go and go and go still going yeah cuz I'm wondering if you clicked part 1/5 or B ok so here we finally get to it exclusions okay I'm looking for section B well of course non-financial group oh boy okay so it starts off the definition starts off with for the three-year period or the period during which the expanded affiliated group has been existed if shorter and then on December 31st a II what what what I thought there was gonna be more than that correct we said that account was defined in section 5 B correct yes you said account was the where is it I'm in Section five be I'm looking for the definition of account um my I mean they hmm I'm really having a hard front time here yeah uh 5b non Financial Group well this is exactly why I told them this part doesn't apply to him because so yeah you can't find okay let me just yeah let's back up here okay I'm in Section B reading the whole thing I'll select the whole thing and I'll just sort of see where the word account pops up in any of Section B okay just the word account I want the word account to show up anywhere in Section B okay it does all right but it does is a verb I'm sorry or sorry is subject of a preposition in this case okay so it shows up as taking into account the application of the session amazing but the weather than that the word account does not show up in the regulations that say it defines it amazing amazing out there I am here and it is not there well then I'm in section one point four seven one - 5b every which way now I have to trust the good people at Cornell Law School sure I'm hoping they're not you know trolling us they could be I mean it would be nice if our own government decided to put the tax code on its own website but again the IRS does even want to own up to it look i google-searched that I mean I really looked around because I was sure that that was the most closed option that applied to me and it was not found so this this is this is pretty experiment I don't know it I don't even know how you describe that but it's yeah it's not exactly rational and so I always came to the conclusion that fatzke does not apply to my corporation right they really know the fact is it doesn't right now and actually when you come down to it you're right this is chapter 4 and FATCA does not apply to a for an entity that payments from the IRS and that's why it's part 4 which refers to chapter 3 that you have to check but there is actually nothing here we went through every possible we know you're not an FF I so we get rid of any of those everything else we've gone through it's like well maybe you are you know maybe maybe it is an account that is not a fine sure come the irises just never defined what it they just never have so Wow um you know listen this is a yeah I have a proposal yeah we we went through this every which way right and it's not very conclusive we've got a cliffhanger situation right now and what I'm going to propose to you hear me out Anthony yeah is that everyone who made it this far into the journey with us click the subscribe button maybe leave a few comments on your impression about w8 Ben II and all the industries it beholds and Anthony I would like for you to sync up with one of your attorney friends and maybe see what conclusions they would bring to this form maybe you could even make a follow-up video to this one somewhere down the road because it's absolutely do this and if you want to really have fun with your with your with your team there so yeah so so which one you say I am and why yeah yeah oh that's a great we watching this video like damn Ryan you got me I totally he's right it's like there is none he's right so this is a great formula brain they'll watch this in like okay we were wrong or chapter four does not apply yeah no you know and I think that there's more to I think you know there aren't there's some more to the section but it's really the rest of it is actually pretty straightforward I think we can stop there because this is really the central issue now I'm sure the question people have is this part this is what it is what do I put here and the answer is really nothing and as a source I guess you could link to this video because we did go through it step by step I haven't seen a more thorough analysis so I think me a favor though come back to this topic I want you to have one of your attorneys on with you and and see how they would break it down because like I don't I don't think that they spent much time thinking about this form it's not a particularly on a daily basis for people and this is another one of those gateway drug forms into the American you have that which you know if you're encountering this form you might do a general review of the other surprises that might await you upon further integration of your business dealings in the United States there's a lot to be said about that Anthony made a bunch of great videos throughout the years so you could get warmed up well he works on part two of the conclusion to the cliffhanger feel God's name do you fill out I think really you know I would say this this is probably going to be a very shared video by by people who say no look this go through this there really is nothing for if you own a foreign entity overseas you check the the part for it there's part five really doesn't apply to you because part five FATCA yours is not one of those things you just really aren't them so you're trying to end you know forcing something that doesn't fit so right and it just sorta think it just shows how complicated this is right the IRS does even know it's not defining things because no idea you know this is probably someone's you know if they watch it oh boy we really need to fix that and I don't fault them I mean they have an impossible task let me just point that law school let me just point out one other things that kind of like nudged me in the direction of that does not apply to me as a non controlled foreign corporation go to part three okay and here's where you claim the treaty benefits that's not that complicated you probably take a half hour you figure out what terms apply to you there are enough resources on that online yes and you pull out the little treaty thing not a problem but look at this look at this Anthony if you say if applicable okay yes it is applicable i'ma or incorporation not bound by the confines of FATCA or US tax law so this is for chapter three purposes only therefore if I filled out chapter four why in the hell would I claim treated benefits later its it feels like it conflicts a little bit doesn't it no I don't think so I kind of see it separate that they're saying well we're not we're not saying that you have treaty benefits for chapter four we're saying it's just for chapter three which is part or because the write up okay well see in part one there's line four so they're actually referring to you it gets a little confusing there so I don't see that there's four chapter three per I mean but I guess what's the purpose of that but if chapter four is applicable to you it's as yes Ajay are we saying well it's like book that's such a weird thing to say claim of treaty benefits if applicable for chapter three purposes only why am i treating cleek why am i claiming treaty benefits under FATCA that's what I'm sure that's the answer I'm trying to get that that's exactly my point it doesn't that's actually one of the piece of that Sokka it's an auto treaty it's never been ratified by the Senate you know so we know FATCA is not a treaty it's just a law it's you know it's actual enforce ability if you know people you know courts actually enforce thing it's really shouldn't be enforceable but you know good luck with that so I wish I wouldn't you know I really wouldn't yeah it just seems that does seem kind of odd no I okay look yeah you had you have to play it safe you're an attorney I'm yeah I'm just speculating here but I really think it would be awesome oh this video could China right and one thing I was just really you know if you do get this form you probably this you might have been looking for this answer where do I mail this to you just send it back to the person gave you you don't mail it to the IRS again they hang on to it in case they're examined oh hey this is a person I paid so there is no you will send it send it and they'll tell you that let's just send it back oh you know what did you know there's a part 30 well that's the certification and it's x-x-x up you know your your email your your spam filter you know do you email one of these you might have a problem there yeah I can summarize that don't lie don't give it a Miss information don't commit perjury and you're fine yeah basically so that's that's a good idea so I think yeah that's what we'll end on this one but we'll pick this up later Gary and I think this sort of you know unfortunately for people to truly understand the absurdity of the IRS you do have to kind of dig into videos like this which is sort of hard yeah and I know people don't want to do it but this is what controls your life you know it really does and so you should know it if somebody wants to take your money and claims they have the right to do so don't you have an obligation to make sure what they're doing is the right thing you know I'm not trusting anyone and I think with good reason because I'm looking for definitions that they even either define by themselves or don't even bother yet they're saying you better do this you have a duty to know all of this hey guys you know uh you don't have the answers here so you're kind of leading us along and no fault to the people who wrote this again they have an impossible task there's too complicated in every exception everything gets more complicated every day so it's just going wrong and it's not gonna it's never going to get better until there's a realization that yeah this is just crazy and there's not that realization so alright so next time Ryan we are joining and look for that video if you haven't watch it there we do have the video if you are an individual and you have that W AP and there is that video on that we'll be answering a whole bunch of questions on that so thanks for joining subscribes are Anthony see you guys right bye-bye