US Reporting Obligations Possibly Imposed by the US government on non-US-domiciled Funds Trading in US Assets

15 October 2024

David Borinsky [email protected]

(not to be relied on as legal advice)

Set forth below is a list of the forms which an investment fund domiciled outside the United States but trading in US assets may plausibly be required to file with various US government agencies.

??Notes to the reader:

·?????? Some of these forms are required to be filed not by the fund itself, but by stakeholders, such as investors or fund managers.?

·?????? It is highly unlikely that any given fund will be required to file all of these forms

·????? This is not an exhaustive list (only a US securities lawyer and a US tax lawyer working together can cover this waterfront for you)

?Tax forms:

1. Form 1040-NR (U.S. Nonresident Alien Income Tax Return) (to report US source income and claim refunds and/or tax treaty benefits)
2. Form W-8BEN-E: Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (to claim treaty benefits for withholding tax purposes)
3. Form 1042-S: Foreign Person's U.S. Source Income Subject to Withholding (to report income and withholding; filed by the withholding agent, not the foreign fund itself)
4. Form 1120-F: U.S. Income Tax Return of a Foreign Corporation (to report income taxable in the US because the fund is engaged in a US trade or business)
5. Form 8833: Treaty-Based Return Position Disclosure (to disclose positions taken based on tax treaties)
6. Form 8621: Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund (to report ownership and/or to make certain elections)
7. Form 8938: Statement of Specified Foreign Financial Assets (to report foreign financial assets when a fund is treated as a US person and meets certain thresholds)
8. FATCA Forms 8938 and 8966 ?(for US persons to report income, gains, losses, distributions and other taxable events arising from the holding or disposition of a non-US account or asset)
9. Form W-8IMY: Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding and Reporting

Non-tax Forms:

1. BE-13: Survey of New Foreign Direct Investment in the United States (to report new direct investments by foreign entities in the United States)
2. Form 13F: Information Required of Institutional Investment Managers (to report equity holdings if the fund manages $100 million or more in certain US equity securities)
3. Schedule 13D or 13G: Beneficial Ownership Reporting (to report significant ownership in a publicly traded company (more than 5% of a class of voting shares))
4. Form 4: Statement of Changes in Beneficial Ownership (to report changes in ownership for >10% owners of a US public company)
5. FinCen Form 114 (FBAR) (to report non-US financial accounts with respect to which a US person has signing authority or other indicia of control)

?

Important factors in determining filing requirements:

?

• Whether the fund is considered to be engaged in a US trade or business
• The types of income received/recognized (e.g., dividends, interest, capital gains)
• The fund's country of residence and any applicable tax treaties
• The size of the fund's US investment
• Extent of ownership by US persons of the underlying fund entity

Feel free to contact me for any clarifications or assistance. David Borinsky [email protected]