§ 516.9 - Release of excess tax withheld at source.

(a) Amounts to be released—(1) Dividends and interest paid by Austrian corporation. If United States tax at the statutory rate has been withheld on or after January 1, 1958, from dividends and interest paid by an Austrian corporation (other than a United States corporation) to a recipient who is a nonresident alien or a foreign corporation, the withholding agent shall release and pay over to the person from whom the tax was withheld an amount which is equal to the tax so withheld.

(2) Dividends subject to 50 percent of statutory rate. If United States tax at the statutory rate has been withheld on or after January 1, 1958, from dividends described in § 516.2(b) and received from sources within the United States by a nonresident alien (including a nonresident alien individual, fiduciary, and partnership) or by a foreign corporation or other entity, whose address at the time of payment was in Austria, the withholding agent shall release and pay over to the person from whom the tax was withheld an amount which is equal to the difference between the tax so withheld and the tax required to be withheld pursuant to § 516.2(d)(2).

(3) Dividends subject to 5 percent rate. If United States tax at the statutory rate has been withheld on or after January 1, 1958, from dividends which qualify under § 516.2(c)(1) for a rate of tax not in excess of 5 percent, the withholding agent shall, if so authorized in accordance with § 516.2(c)(3), release and pay over to the corporation from which the tax was withheld an amount which is equal to the difference between the tax so withheld and the tax required to be withheld pursuant to § 516.2(d)(3).

(4) Coupon bond interest—(i) Substitute form. In the case of every taxpayer who furnishes to the withholding agent Form 1001-A clearly marked “Substitute” and executed in accordance with § 516.4(d)(1)(i), where United States tax has been withheld at the statutory rate on or after January 1, 1958, from coupon bond interest exempt under § 516.4(b), the withholding agent shall release and pay over to the person from whom the tax was withheld an amount which is equal to the tax so withheld, if the taxpayer also attaches to such form a letter in duplicate, signed by the owner, or by his trustee or agent, and containing the following:

(a) The name and the address of the obligor;

(b) The name and the address of the owner of the interest from which the excess tax was withheld;

(c) A statement that, at the time when the interest was received from which the excess tax was withheld, the owner was neither a citizen nor a resident of the United States but was a resident of Austria, or, in the case of a corporation or other entity, the owner was an Austrian corporation or other entity; and

(d) A statement that the owner at no time during the taxable year in which the interest was received had a permanent establishment in the United States. One such substitute form shall be filed in duplicate with respect to each issue of bonds and will serve with respect to that issue to replace all Forms 1001 previously filed by the taxpayer in the calendar year in which the excess tax was withheld and with respect to which such excess is released.

(ii) Disposition of form. The original and duplicate of substitute Form 1001-A (and letter) shall be forwarded by the withholding agent to the Director of International Operations, Internal Revenue Service, Washington, D.C., in accordance with § 1.1461-2(b) of this chapter.

(5) Interest on noncoupon bonds, royalties, pensions, and annuities. If a taxpayer furnishes to the withholding agent the authorization of release prescribed in § 516.4(d)(2)(ii), § 516.5(a)(2)(ii), or § 516.6(b)(2) and United States tax has been withheld at the statutory rate on or after January 1, 1958, from the interest, copyright royalties or other like amounts, pensions, or annuities in respect to which such authorization is prescribed, the withholding agent shall release and pay over to the person from whom the tax was withheld an amount which is equal to the tax so withheld.

(6) Motion picture film rentals. If a taxpayer furnishes to the withholding agent the authorization of release prescribed in § 516.5(b)(2)(ii) and United States tax has been withheld at the statutory rate on or after January 1, 1958, from the motion picture film rentals in respect to which such authorization is prescribed, the withholding agent shall release and pay over to the person from whom the tax was withheld an amount which is equal to the difference between the tax so withheld and the tax required to be withheld pursuant to § 516.5(b)(2)(i).

(b) Amounts not to be released. The provisions of this section do not apply to excess tax withheld at source which has been paid by the withholding agent to the Director of International Operations.

(c) Statutory rate. As used in this section, the term “statutory rate” means the rate prescribed by chapter 3 of the Internal Revenue Code of 1954 as though the convention had not come into effect.

(d) Amounts withheld during 1957. For provisions respecting the refund of excess tax withheld during the calendar year 1957, see § 516.10.