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Changes to 2011 Forms

Updates to the Form 592-A on 07/13/2010 –– Payment Voucher for Foreign Partner or Member Withholding

We replaced text on the Form 592-A Instructions on Page 1, Column 1, in these sections:

  1. What's New paragraph
  2. Section C Waivers

Previous Version

  1. Note: adding text.
  2. There is no provision in the law to allow waivers or reduced withholding to foreign partners or members.

Revised Version

  1. Beginning January 1, 2011, we began applying Federal Treasury Regulation 1.1446-6 procedures to reduce or eliminate withholding of California tax on effectively connected taxable income (ECTI) from California sources allocable to a foreign partner. The foreign partner must first sign and send IRS Form 8804-C to the partnership. The foreign partner must sign and send Form 589, Nonresident Reduced Withholding Request to the Franchise Tax Board (FTB) along with a signed copy of IRS Form 8804-C. The FTB will review the request within 21 business days. If the request is approved, the partnership should remit the reduced withholding amount to the FTB along with Form 592-A, Payment Voucher for Foreign Partner or Member Withholding.
  2. There is no provision in the law to allow waivers of withholding to foreign partners. However, if a foreign partner has ECTI from California sources they may apply for reduced withholding. Follow instructions using Form 589.

Reason for the changes

To explain that beginning January 1, 2011, we began applying corresponding federal procedures which allow foreign partners to request to reduce or eliminate withholding of California tax.

Impact

There is no tax impact.

Back to Tax Form Changes for 2011