Beneficial owner. The beneficial owner is
the person who is the owner of the income for tax purposes and who beneficially
owns the income. Thus, a person receiving income as a nominee, custodian, or
agent for another person is not the beneficial owner of the income. Generally, a
person is treated as the owner of the income to the extent it is required under
U.S. tax principles to include the amount paid in gross income on a tax return.
A person who is the owner of income is considered the beneficial owner of that
income unless that person is a conduit entity whose participation in a
transaction can be disregarded. Generally, the principles of section 7701(l) and
Regulations section 1.881-3 apply to determine if a person is a conduit
The beneficial owners of income paid to a
partnership are those persons who, under the U.S. tax principles, are the owners
of the income for tax purposes in their separate or individual capacity and who
beneficially own the income. Generally, the beneficial owners of income paid to
a partnership are the partners, other than a partner that is itself a
partnership or a conduit. (If a partner is a partnership or conduit, the
beneficial owner is the first person in the chain of ownership that is not
itself a partnership or a conduit.)
Foreign person. A foreign person includes a
nonresident alien individual, a foreign corporation, a foreign partnership, a
foreign trust, a foreign estate, and any other person that is not a U.S. person.
Generally, a payment to a U.S. branch of a foreign person is a payment to a
Nonresident alien individual. Any individual
who is not a citizen or resident of the United States is a nonresident alien
individual. An alien individual meeting either the "green card test" or the
"substantial presence test" for the calendar year is a resident alien. Any
person not meeting either test is a nonresident alien individual. Additionally,
an alien individual who is a resident of a foreign country under the residence
article of an income tax treaty, or an alien individual who is a resident of
Puerto Rico, Guam, the Commonwealth of the Northern Mariana Islands, the U.S.
Virgin Islands, or American Samoa is a nonresident alien individual. See Pub.
519, U.S. Tax Guide for Aliens, for more information on resident and nonresident