California Form 592-A - Payment Voucher For Foreign Partner Or Member Withholding - 2013 Page 3
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4Instructions for Form 592-A
Payment Voucher for Foreign Partner or Member Withholding
References in these instructions are to the Internal Revenue Code (IRC) as of January 1, 2009, and to the California Revenue and Taxation Code (R&TC).
What’s New
partnership or LLC may be subject to the penalty for failing to withhold if the FTB
determines that the distribution represented taxable income.
Increase in Rates – For taxable years beginning on or after January 1, 2012,
D Interest and Penalties
the maximum personal income tax rate increased to 12.3%. In addition,
non-California partnerships are subject to withholding requirements on a sale of
The law provides for interest and penalties on late payments of withholding.
California real property at a rate of 3 1/3% (.0333) of sales price or 12.3% of gain.
Interest is computed from the due date of the withholding to the date paid.
The alternative withholding rate for the gain on sale of California real property by
S corporations increased to 13.8% and 15.8% for financial S corporations.
• Failure to timely withhold may result in the withholding agent being personally
liable for the amount of tax that should have been withheld and for interest and
Do Not Round Cents to Dollars – On this form, do not round cents to the nearest
penalties.
whole dollar. Enter the amounts with dollars and cents as actually withheld.
• Failure to provide Form(s) 592-B to the payees may result in penalties up to
$100 per Form 592-B.
General Information
How to Complete Form 592-A
Partnership or limited liability company (LLC) withholding on foreign partners or
members is remitted to the Franchise Tax Board (FTB) with Form 592-A, Payment
Form 592-A has five payment vouchers. The first four installment vouchers are
Voucher for Foreign Partner or Member Withholding. At the close of the taxable
submitted with each of the four withholding payments throughout the year. The
year, the partnership or LLC completes Form 592-F, Foreign Partner or Member
fifth voucher is a supplemental payment voucher. The supplemental payment
Annual Return, to report the total withholding for the year and allocate the income
voucher is only submitted when Form 592-F has a balance due.
or gain and related withholding to the foreign partners or members. A completed
To complete the payment vouchers, enter all the information requested, using
Form(s) 592-B, Resident and Nonresident Withholding Tax Statement, must be
provided to the payees.
black or blue ink. If you are submitting the supplemental payment voucher, check
the appropriate box for Electronic or Paper to reflect how Form 592-F is being
Beginning January 1, 2011, we began applying Federal Treasury Regulation
submitted.
1.1446-6 procedures to reduce or eliminate withholding of California tax on
Enter the beginning and ending dates of the partnership’s or LLC’s taxable year.
effectively connected taxable income (ECTI) from California sources allocable to a
foreign partner. The foreign partner must first sign and send federal Form 8804-C,
The year at the top of the form should be the same as the ending taxable year.
Certificate of Partner-Level Items to Reduce Section 1446 Withholding, to the
To ensure timely and proper application of the withholding payment to the
partnership. The foreign partner must sign and send Form 589, Nonresident
withholding agent’s account, enter the business or individual withholding agent’s
Reduced Withholding Request to the FTB along with a signed copy of federal
name, and SSN, ITIN, federal employer identification number (FEIN), CA Corp no.,
Form 8804-C. The FTB will review the request within 21 business days. If the
or CA SOS file number of the partnership or LLC in the spaces provided.
request is approved, the partnership should remit the reduced withholding
Private Mail Box (PMB) – Include the PMB in the address field. Write “PMB”
amount to the FTB along with Form 592-A.
first, then the box number. Example: 111 Main Street PMB 123.
Supplemental Payment Voucher – If there is a balance due on Form 592-F,
Foreign Address – Enter the information in the following order: City, Country,
submit the Supplemental Payment Voucher from Form 592-A and Form 592-F
Province/Region, and Postal Code. Follow the country’s practice for entering the
with the payment at the same time.
postal code. Do not abbreviate the country’s name.
Backup Withholding – Beginning on or after January 1, 2010, with certain limited
Enter the payment amount that represents withholding on partnership or LLC
exceptions, payers that are required to withhold and remit backup withholding to
income or gain allocable under IRC Section 704 to foreign (non-U.S.) partners or
the Internal Revenue Service (IRS) are also required to withhold and remit to the
members. If you have withholding for domestic and foreign partners or members,
FTB. The California backup withholding rate is 7% of the payment. For California
you can use the Installment Payment Worksheet that follows these instructions
purposes, dividends, interests, and any financial institutions release of loan funds
to figure the required installment payment amounts of withholding for foreign
made in the normal course of business are exempt from backup withholding. For
partners or members. For more information about withholding on foreign
additional information on California backup withholding, go to ftb.ca.gov and
partners or members, get FTB Pub.1017, Resident and Nonresident Withholding
search for backup withholding.
Guidelines.
If a payee has backup withholding, the payee must contact the FTB to provide a
Do not use Form 592-A to report tax withheld on domestic nonresident partners
valid Taxpayer Identification Number (TIN) before filing a tax return. The following
or members. For more information regarding reporting tax withheld on domestic
are acceptable TINs: social security number (SSN); California corporation number
nonresident partners or members, get Form 592, Resident and Nonresident
(CA Corp no.); or California Secretary of State (CA SOS) file number. Failure to
Withholding Statement.
provide a valid TIN will result in the denial of the backup withholding credit.
When and Where to File
A Purpose
Payments with Form 592-A are due to the FTB on the 15th day of the 4th, 6th,
Use Form 592-A to remit withholding payments to the FTB made during the
9th, and 12th month of the partnership’s or LLC’s taxable year. When a due date
year, or to remit the balance due on partnership or LLC income or gain allocable
falls on a weekend or holiday, the deadline to file and pay is extended to the next
under Internal Revenue Code (IRC) Section 704 to foreign (non-U.S.) partners or
business day. If there is a balance due on Form 592-F, line 8, remit payment
members.
with the Supplemental Payment Voucher provided. The Supplemental Payment
Use Form 592-A to remit withholding payments under California Revenue and Tax
Voucher and payment are due by the original due date of Form 592-F, regardless
Code (R&TC) 18664. Backup withholding supersedes all types of withholding. For
of extension. Using black or blue ink, make your check or money order payable
more information on backup withholding, go to ftb.ca.gov and search for backup
to: “Franchise Tax Board.” Write your SSN or ITIN, FEIN, CA Corp no., or CA
withholding.
SOS file number, and “2013 Form 592-A” on it. Make all checks or money orders
payable in U.S. dollars and drawn against a U.S. financial institution.
B Withholding Rates
If you are remitting payment only, detach the appropriate installment voucher
R&TC Section 18662 requires withholding on payments made to nonresidents
from Form 592-A and enclose, but do not staple the payment with the voucher
for income received from California sources. For foreign partners or members,
and mail to:
the withholding rate is the maximum California tax rate applicable to the partner
FRANCHISE TAX BOARD
or member (currently, 8.84% for corporations, 10.84% for banks and financial
PO BOX 942867
institutions, and 12.3% for all others).
SACRAMENTO CA 94267-0651
C Waivers
If you are submitting Form 592-F with a payment, you must enclose, Form 592-F,
the Supplemental Payment Voucher from Form 592-A, and your payment, but do
There is no provision in the law to allow waivers of withholding to foreign
not staple.
partners. However, if a foreign partner has ECTI from California sources they may
Mail these items to the address above.
apply for reduced withholding. Follow instructions using Form 589.
The withholding agent retains this form for a minimum of four years and must
If the distribution from a partnership or LLC is determined to be a return of
provide it to the FTB upon request.
capital or does not represent taxable income for the current or prior years, no
withholding is required. Although a waiver is not required in these situations, the
Form 592-A Instructions 2012 Page 1
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