Tax Residency Application (Form 8802) and Certificate (Form 6166)

IRS Form 8802, also known as the Application for United States Residency Certification, is an essential document for individuals and companies seeking to claim tax treaty benefits while working or operating in foreign countries. This form allows them to establish their U.S. residency and enjoy reduced taxation rates on specific forms of income.

The purpose of Form 8802 is to apply for a Tax Residency Certificate, which serves as official proof of U.S. residency for tax purposes. Individuals or organisations must meet specific criteria to be eligible for this certificate.

Eligibility

To start with, an individual or organisation can be considered a U.S. resident if they are subject to U.S. taxes. If this requirement is met, they may be eligible to apply for a Tax Residency Certificate under the following scenarios

• Filing an appropriate income tax return: If a tax return has been filed for the certification year, the applicant can submit Form 8802 to request the certificate.
• Filing a return for the most recent year that a return was due: In cases where a return is not yet due for the certification year, the applicant can still apply for the certificate by submitting a return for the most recent year in which a return was due.
• Not required to file an income tax return: If an individual or organisation is not obligated to file an income tax return for the tax period on which the certification will be based, they can still apply for the certificate by providing other relevant documentation.

‍

There are certain scenarios where an individual or entity is ineligible to apply for a Tax Residency Certificate. 

• Failure to file a required U.S. return: If an individual or organisation has not filed a required U.S. return, they cannot apply for the certificate.
• Filing a return as a nonresident: Individuals or entities who have filed a return as a nonresident are not eligible for the certificate.
• Dual resident individuals: If an individual is considered a dual resident, meaning they have made or intend to make a determination, pursuant to the tie-breaker provision within an applicable treaty, that they are not a resident of the United States but a resident of another treaty country, they cannot apply for the certificate.
• U.S. entity without U.S. partners, beneficiaries, or owners: If an entity organised in the United States, such as a domestic partnership, domestic grantor trust, or domestic LLC disregarded as an entity separate from its owner, does not have any U.S. partners, beneficiaries, or owners, it is not eligible for the certificate.
• The Exempt Organisation Not Organised in the United States: An exempt organisation that is not organised in the United States cannot request certification.
• Trust part of an employee benefit plan without a qualified custodian bank: If a trust is part of an employee benefit plan during its first year of existence and is not administered by a suitable custodian bank as defined in 17 CFR 275.206(4)-2(d)(6)(i), it is not eligible for the certificate.

‍

How many countries can you apply for?

The IRS Form 8802 contains a list of 66 countries, and there is no limit on the number of countries you can apply for per application. This means that individuals or entities can apply for all 66 countries listed in a single form.

‍

What are the application fees, and how do you pay?

If you're wondering about the user fee and payment process for Form 8802, it varies based on the applicant's classification. For Individuals applying for Residency Certification, the user fee is $85, while for Entities, it's $185. You can pay electronically via Pay.gov by searching for "IRS Certs." Once you've paid, provide the confirmation I.D. on Form 8802 and the required information.

‍

How long is the Residency Certification valid?

The certification period lasts one year and can be requested for current and past years. Ideally, entities doing business outside the U.S. should be applying for a TRC each year.

‍

Specific Instructions to Fill Form 8802

Checkboxes at the Top of Page 1:

** Additional Requests: Check the box if you're submitting Form 8802 for additional Form(s) 6166.

• If the IRS has already given you Form 6166, you need to submit a separate Form 8802 and pay the nonrefundable user fee.
• You can only use this extra request process if you haven't changed any tax information from the original Form 8802.
• This process can be used to get a Form 6166 for any country, even if you didn't mention it on a previous Form 8802.
• You have to make the additional request for Form 6166 within 12 months of getting the most recent Form 6166 for the same tax period.
• Additional Documentation: If you previously submitted documentation for a country in your original application, you don't need to resubmit it when requesting an additional Form 6166. Simply write "See attached copy of the original Form 8802" in the signature line and attach a copy of the original Form 8802. Include the required documentation with the additional request for a country not identified in the original Form 8802. Sign and date the additional request form and attach a copy of the original Form 8802.
• Additional Request by Third-Party Appointees: Third-party representatives cannot request additional Form(s) 6166 for countries not authorised by the taxpayer. If you plan to authorise a third-party representative to request additional Forms 6166 for an unauthorised country, include a written statement on line 10.
  ‍

** Foreign Claim Form: Check the box if you have included with Form 8802 a foreign claim form sent to you by a foreign country.

• The submission or omission of a foreign claim form will not affect your residency certification.
• If the IRS does not have an agreement with the foreign country to date stamp or otherwise process the form, they will not process the application and will mail the foreign claim form back to you.
• For more information about foreign countries with which the IRS has an agreement to process a foreign claim form, call the U.S. residency certification unit at 267-941-1000 (not a toll-free number).

Electronic payment confirmation no:

• To access the electronic payment page, go to Pay.gov and search for "IRS Certs."
• Enter the required information and complete the payment process.
• Once the IRS processes your payment, you will receive a confirmation number.
• Use the confirmation number on Form 8802
• You can use the Agency Tracking ID or the Pay.gov ID as the confirmation number.
• If you pay for multiple Forms 8802, use the same confirmation number on each form.
• The IRS will only process Form 8802 with the electronic payment confirmation number.

Enter Applicant's Name and U.S. Taxpayer Identification Number on Line 1:

As part of certifying your U.S. residency, the IRS needs to verify that the name(s) and taxpayer identification number(s) (TIN(s)) provided on this application match the information on your previously filed U.S. tax return for the relevant tax period. If you did not have to file a U.S. tax return, enter the name and TIN as they appear on the documentation you previously provided to the IRS (such as Form 8832) or on documentation provided by the IRS (such as a determination letter). 

Change in taxpayer's name:

• If the taxpayer's name has changed since the most recent Form 8802 was filed with the IRS, the Form 8802 and tax disclosure authorisation for each individual or entity must be submitted under the taxpayer's new name.
• Additionally, the taxpayer must provide documentation of the name change along with Form 8802, such as a trust agreement or corporate charter.
• Certification will only be issued if the name change has been updated in the IRS database.

Notification of name change:

• Businesses, trusts, or estates can inform the IRS of a name change by checking the appropriate box on Forms 1120, 1120S, 1065, or 1041 when filing.
• Individuals can indicate a name change on Form 1040 when filing.
• If you have changed your name and address, you can notify the IRS of the changes by using Form 8822.

Fill in Line 2. Applicant's Address

For certification, enter your physical address for the calendar year requested. Do not use a P.O. box or C/O address, as certification may be denied.

Line 3a. Mailing Address

• To get Form 6166 and related correspondence, you can have it mailed to you or a third party. Provide your address on line 3a for all correspondence. If not, it’ll be sent to the address on line 2.
• For a foreign address, provide it on Form 8802. Use prepaid DHL, UPS, or FedEx labels and envelope/box. The pick-up address and phone number are Internal Revenue Service, 2970 Market St., Philadelphia, PA 19104 267-466-1679.

Line 3b. Third-Party Appointee's Information

• The third-party appointee identified on line 3b should be knowledgeable about Form 8802 and able to respond to any IRS questions regarding your form.
• If you have multiple appointees, attach a list of the additional appointees not identified on line 3b.
• Providing your third-party appointee's telephone or fax number will expedite the processing of your Form 8802 if the IRS has any questions.
• Form 8821 authorises disclosure of tax information to a third-party designee of the taxpayer, while Form 2848 authorises a third party to represent you before the IRS.
• If you have attached Form 2848 or Form 8821, you do not need to fill out line 3b. On line 3b, write, “See attached authorisation.”
• Attach a Form 2848 or Form 8821 for each third party you authorise to receive your tax information.
• Under the 3-year procedure, the third-party appointee completes a Form 8802 in the first year that must be signed and dated by the applicant.
• In the following two tax years, the third-party appointee must complete a new Form 8802 that is not required to be signed and dated by the applicant.
• Form 2848 or Form 8821 must be attached to Form 8802 in year one and indicate all years in the 3-year period for which certification is requested.

Check if you were required to file a U.S. tax form for the tax period(s) on which the certification will be based on Line 5.

• If Yes, check which Forms were required to be filed. For Individuals, you can check 1040 and check 1120 for Corporations.
• If No, check the appropriate box for the explanation. If your reason is not mentioned, check on “Other” and provide appropriate reasons and documentation.

Check if Line 6. (Parent, Parent Organization, or Owner) is applicable

• If you answered "Yes" to line 5, skip line 6. If you responded "No" to line 5, complete line 6.
• If you answered "Yes" to line 6, provide the parent's, parent organisation's, or owner's information. For a minor child, enter the name, address, and TIN of the parent who reported the child's income.
• If you answered "No" to line 6, attach proof of income and explain why a tax return is not required for the tax period(s) in question.

Enter the Calendar Year of Request on Line 7

The certification period lasts one year and can be requested for current and past years. You can enter the 4-digit calendar year(s) for which you seek certification.

Fill in Line 8. with Appropriate Tax Period(s)

When requesting certification for a tax period that has yet to reach its due date, enter the latest required tax return date (YYYYMM). If you are a fiscal year taxpayer, enter the year and month corresponding to the fiscal tax year's end. For certification of a prior year, enter the year and month that correspond to the end of the preceding year's tax period. It is essential to enter the correct 4-digit year and 2-digit month.

Fill in the Purpose of Certification on Line 9

When applying for certification, make sure to indicate the purpose of your certification. If you are applying for an income tax treaty, requesting certification for the right country is essential. When applying for VAT certification, provide an NAICS code on Form 8802. 

Ensure that it matches the code on your return to receive Form 6166. Remember that VAT certification requires a specific statement, and the NAICS codes should remain unchanged since the last return was filed.

Sign and date the application on Page 2

• Only authorised individuals can sign Form 8802. If a third-party representative is authorised, they must attach documentation. Any unauthorised signatures must include a statement and appropriate documentation.
• You must also add your Title and phone number on the application.

Enter the Number of Certifications (Forms 6166) Requested for Each Country on Line 11 and the Total Number of Certifications (Forms 6166) Requested on Line 12.

Enter the number of certifications needed for each country listed in columns A, B, C, and D. If a country is not listed, enter its name in the blank spaces at the bottom of column D.

If you request certifications for a country for multiple calendar years, enter the total number of certifications for all years. Attach a statement to Form 8802 identifying the country, year, and number of certifications per year. The total number of certifications must agree with the number entered to the right of the related country code on line 11.

Add the total number of certifications requested in columns A, B, C, and D of line 11, and enter the sum on line 12.

‍

Conclusion

In short, IRS Form 8802 provides a pathway for individuals and companies to claim tax treaty benefits by proving their U.S. residency. By submitting this form and meeting the eligibility criteria, applicants can apply for a Tax Residency Certificate, which allows for reduced taxation rates on specific types of income. 

However, it is essential to note that certain situations exist where individuals or entities are not eligible to apply for the certificate. It is crucial to review the eligibility requirements carefully before submitting Form 8802.

Connect with our team on LinkedIn.