IRS Charges Fee For US Residency Certification

by Mike Godfrey, Tax-News.com, Washington

07 September 2006

The US Internal Revenue Service is to begin charging user fees for processing applications for United States Residency Certifications, the agency has announced.

The application form in question, Form 8802, is used to request Form 6166, a letter that the applicant may use as proof of their status as a resident of the United States to claim benefits under an income tax treaty, or an exemption from a value added tax (VAT) imposed by a foreign country.

A single Form 8802 can be used to request multiple Forms 6166. The initial user fee of $35 covers a single Form 8802 requesting up to 20 Forms 6166 for a single Taxpayer Identification Number (TIN), regardless of the country for which certification is requested, or the tax period to which the certification applies. An additional $5 covers up to 20 additional Forms 6166 on the same Form 8802.

The IRS is advising applicants to include all Form 6166 requests on a single Form 8802 to avoid a new $35 user fee charge for processing a second Form 8802 application.

The following fee schedule applies based on the number of Forms 6166 requested per Form 8802:

• 1 to 20 — $35
• 21 to 40 — $40
• 41 to 60 — $45
• 61 to 80 — $50

The IRS said that it has implemented the new fee as a result of an Office of Management and Budget directive instructing federal agencies to charge fees reflecting the full cost of goods or services that “convey special benefits to recipients beyond those accruing to the general public”.

The new fees will be published in an Internal Revenue Bulletin (IRB) on Sept. 11, 2006.

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