Instructions For Forms 8804, 8805, And 8813

Publicly Traded

withholding tax under section 1446, but

partnership's reporting requirements

who fails to do so, can be subject to a

with respect to Forms 8804 and 8805 as

Partnerships (PTP)

civil penalty under section 6672. The

set forth in the next paragraph and

A PTP is any partnership whose

civil penalty is equal to the amount that

elsewhere in these instructions.

interests are regularly traded on an

should have been withheld and paid

established securities market

An upper-tier partnership that has

over.

(regardless of the number of its

had section 1446 withholding tax

Other Penalties

partners). However, it doesn't include a

payments made on its behalf by a

PTP treated as a corporation under the

lower-tier partnership will receive a copy

Penalties can also be imposed, absent

general rule of section 7704(a).

of Form 1042-S or Form 8805 from the

reasonable cause and good faith, for

lower-tier partnership. The upper-tier

failing to accurately report the amount of

A PTP that has effectively connected

partnership must in turn file these forms

tax required to be shown on a return, if

income, gain, or loss must withhold tax

with its Form 8804 and treat the amount

any portion of the resulting

on distributions of that income made to

withheld by the lower-tier partnership as

underpayment is attributable to

its foreign partners. The rate is 39.6%

a credit against its own liability to

negligence, substantial understatement

(0.396) for non-corporate foreign

withhold under section 1446. This credit

of income tax, valuation misstatement,

partners, and 35% (0.35) for corporate

is allowed on line 6b or line 6c of the

or fraud. See sections 6662 and 6663.

partners. The PTP can’t consider

Form 8804 filed by the upper-tier

preferential rates when figuring the

Treatment of Partners

partnership. The upper-tier partnership

section 1446 withholding tax for a

must also provide to its partners the

A partnership's payment of section 1446

partner. The partnership uses Form

information described in

Reporting to

withholding tax on ECTI allocable to a

1042, Form 1042-S, and Form 1042-T

Partners, earlier. These statements and

foreign partner generally relates to the

to report withholding from distributions

forms will enable those partners to

partner's U.S. income tax liability for the

instead of following these instructions. It

obtain appropriate credit for tax withheld

partner's tax year in which the partner is

also must comply with the regulations

under section 1446.

subject to U.S. tax on that income.

under section 1461 and Regulations

section 1.6302-2.

See Regulations section 1.1446-5 for

Amounts paid by the partnership

additional information.

under section 1446 on ECTI allocable to

Tiered Partnerships

a partner are allowed to the partner as a

Specific Instructions

The term “tiered partnership” describes

credit under section 33. The partner

the situation in which a partnership

can’t claim an early refund of

owns an interest in another partnership.

withholding tax paid under section 1446.

Address

The former is an “upper-tier partnership”

Amounts paid by a partnership under

When providing a U.S. address on Form

and the latter is a “lower-tier

section 1446 for a partner are to be

8804, 8805, or 8813, include the suite,

partnership.” An upper-tier partnership

treated as distributions made to that

room, or other unit number after the

that owns a partnership interest in a

partner on the earliest of the following.

street address. If the post office doesn't

lower-tier partnership is allowed a credit

deliver mail to the street address and

1. The day on which this tax was

against its own section 1446 withholding

the partnership (or withholding agent)

paid by the partnership.

tax liability for any section 1446

has a P.O. box, show the box number

withholding tax paid by the lower-tier

2. The last day of the partnership's

instead of the street address. If the

partnership for that partnership interest.

tax year for which the amount was paid.

partnership (or withholding agent)

If an upper-tier partnership provides

3. The last day on which the partner

receives its mail in care of a third party

appropriate documentation to a

owned an interest in the partnership

(such as an accountant or an attorney),

lower-tier partnership, the lower-tier

during that year.

enter on the street address line “c/o”

partnership can look through the

followed by the third party's name and

However, the amount of section 1446

partnership to the partners of such

street address or P.O. box.

withholding tax paid during a tax year by

upper-tier partnership in determining its

the partnership is generally treated as

section 1446 withholding tax due. The

When providing a foreign address on

an advance or draw under Regulations

look-through can apply only with respect

Form 8804, 8805, or 8813, enter the

section 1.731-1(a)(1)(ii) to the extent of

to the portion of the upper-tier

number and street, city or town, state or

the partner's share of income for the

partnership's allocation that is allocable

province, the name of the country, and

partnership year. See Regulations

to partners of such partnership for which

ZIP or foreign postal code. Follow the

section 1.1446-3(d)(2)(v) for more

appropriate documentation has been

foreign country's practice in placing the

details.

received by the lower-tier partnership.

postal code in the address. Don't

For more information, see Regulations

abbreviate the country name.

A partner that wishes to claim a credit

section 1.1446-5(c) for upper-tier

against its U.S. income tax liability for

Form 8804

foreign partnerships and Regulations

amounts withheld and paid under

section 1.1446-5(e) for upper-tier

section 1446 must attach Copy C of

Lines 1c, 1d, 2c, and 2d

domestic partnerships. See Regulations

Form 8805 to its U.S. income tax return

section 1.1446-5(b) for reporting

See Address above.

for the tax year in which it claims the

requirements.

credit.

Lines 4a, 4e, 4i, 4m, and 4q

See Regulations section 1.1446-3(d)

Note. The look-through rules referred

Figure the partnership's ECTI using the

(2) for additional information.

to above apply only for purposes of the

definition, earlier. Enter the total ECTI

lower-tier partnership's calculation of its

allocable to foreign partners (by income

section 1446 withholding tax liability. It

type) on lines 4a, 4e, 4i, 4m, and 4q.

doesn't affect the upper-tier

With respect to lines 4i, 4m, and 4q,

Instructions for Forms 8804, 8805, and 8813 (2017)

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Instructions For Forms 8804, 8805, And 8813 - 2017 Page 5

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