W-8BEN Foreign Customer Interest Withholding

If a new foreign (non-U.S. resident) customer fails to provide a valid W-8BEN form to certify their foreign status, the Bank must treat that person as an U.S. person and withhold 28% of any interest payment made to that individual. Is that correct?

What happen if the customer's W-8BEN has expired (3 years from the tome account opened) and the bank is not able to obtain a new W-8BEN, should the Bank still consider the customer as a foreign individual, or should the bank now treats the customer as a missing TIN U.S. person?

If the Bank still consider the customer as a Non-Resident Alien (NRA), then should the bank be required to withhold any deposit interest payment paid to the account? According to IRS pub 515, it appears deposit interest to NRA is exempt for withholding.

Thank you.

I am not the one who handles the withholding, but we have done it on interest-bearing accounts for NRA where a unexpired W-8BEN is not on file. A valid W-8 form would be where the exempt from withholding would come into play.
Not sure you know, but it is Dec. 31 three yrs after account is opened, not 3 yrs from the date opened. Sometimes the extra few months gives you time to contact the costumer.
I would not consider the customer as a missing TIN US person. A signed W-9 would change their status.

Double post. (Double answer too ) Our posting guidelines ask participants not to post the same question in more than one forum.

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