IRS Withholding Regulations in Today’s Federal Register; to Apply to IRAs and Employer Plans

Published in today’s Federal Register are IRS proposed regulations that would govern tax withholding from certain payments from retirement savings arrangements and commercial annuities, when a payment is to be sent to a destination outside the United States. The regulations also address withholding when a payment is be delivered to a financial organization within the U.S. if the recipient has no U.S. residence address, and certain other situations—including payments sent to military or diplomatic postal destinations.

If finalized, the regulations would apply to IRAs and to employer-sponsored retirement plans governed by Internal Revenue Code Section 401(a)—which includes profit sharing/401(k), defined benefit, money purchase pension, and certain other “qualified plans”—as well as 403(b), governmental 457(b), SEP, and SIMPLE plans.

Further details can be found in the May 30, 2019, Latest News article.

The Federal Register-published IRS document can be found here.