Profit Sharing Withdrawal

The information contained in this page is aimed at assisting Non-US Nationals apply for and receive the full balance of their WGC Profit Sharing account if they part company with WesternGeco.

2nd September 2002 - Update
That's it. I have received my cheque from the IRS without and further problems. What a nightmare. Make sure you obtain your ITIN as soon as possible regardless of whether you and thinking of leaving. Once you have one you can avoid all this grief.
I'm not sure how the new WesternGeco funds work and how your original profit sharing is tied up however, get your ITIN anyway.

14th April 2002 - Update
Well, the 1042-S has arrived at home so when I get there I'll be sending in my 1040NR. Of interest is that a colleague here received a cheque for his withholding rather than the tax statement. Good for him.
Ideally, if you are going to apply for your profit sharing make sure you have already obtained the ITIN. If you send that off with your Application for Distribution and W-8Ben you should receive the whole lot without any withholding at all.

16th March 2002 - Update
The following is just in from Paulette - "Hi Neil, The Trustee, Northern Trust Bank will be mailing your 1042-S form today. (point of clarification the forms get mailed on the 15th of March not that you must receive it by that date). Regards, Paulette" - which does not quite agree with Mr Jayakumar but I would imagine Paulette is correct. So, this sounds promising does it not? Penny is keeping an eye out for the mail because I'm at work at present. I believe I have until July to send my refund application in. I will be checking with Mr Jayakumar that I have completed the 1040NR correctly and will post an example form here later this month.

15th March 2002 - Update
I finally have my ITIN - wow what a nightmare. Anyway, I just need to get my 1042S statement - issued by Western I guess - and will then have all the relevant documents to claim my tax back. Today I sent another note to Paulette Moore enquiring about my 1042S. After speaking with Mr Jayakumar (Philadelphia IRS) earlier today - what a helpful guy, he actually called me - I was advised that I should have received my 1042S already. He said it would be issued by the withholding company and should arrive no later than 15th March. Well, I have not received it as yet hence my latest enquiry to Paulette. I'll update when I get a reply from Paulette.

22nd January 2002 - Update
Paulette Moore has just sent the following document. It is a letter that should be included in a 'termination pack' to assist crew in the process of applying for their profit sharing. You can get a copy of the letter here if you did not receive one.

19th January 2002 - Update
I have just finished speaking with the IRS in Philadelphia (a Mr Jayakumar this time) to enquire about the status of my ITIN application. He told me that my application has been processed however I have not yet been assigned an ITIN. He explained that the reason for this was that I did not send an original document of proof of identity (passport or birth certificate). I explained that I had consulted the IRS department in the London Consulate prior to my ITIN application. They had advised me that sending an expired passport along with a photocopy of my current passport was acceptable. (I could not send my current passport because it would be in use and I could not go to London to have a copy notarised because I was about to leave the country.) I am waiting for Mr Kumar to call back. He said that he would request that the department issuing the ITIN re-examine my application under the circumstances outlined. (I had sent a covering letter with my W-7 explaining all this of course) We will see what the outcome is…..

More worrying is some new information just received by a friend in the same situation. It came in an email from Paulette Moore - “This will confirm we received your completed W-8BEN form requesting a refund of your 2001 Federal Withholding Tax. We were informed by the trustee Northern Trust Bank, that since the form was received on 1/9/2002 the bank will not be able to issue your refund. This will have to be done by the Internal Revenue Service. You will be receiving a 1042-S Tax Form. Please send a copy of this form along with a completed 1040NR form to the Internal Revenue Service. For your convenience I have included the web site for you to down load the 1040NR form with instructions.” (You can get the form and instructions via the links below)

18th October 2001 - Update
I sent off for my profit sharing 8 weeks ago and have now received a cheque. I completed the W-8Ben form and sent that along with the distribution form. Unfortunately I have been stopped tax even though I sent the correct information off.
I spoke with Paulette Moore (Kim Boaz no longer with company) today (18th October) and she said that all I have to do now is send off the W-7 form to the IRS to get that ITIN and when I have that I should send it to her - the original document I receive from the IRS.
So, I will send that off in the morning and see how long it takes to get the withholding back. I will keep you updated.

20th August 2001 - Start of Application
Prior to applying for the transfer of my profit sharing following my resignation from WesternGeco, I enquired whether the form - "Application for Distribution" - was all that was required. I was concerned that a 20% tax withholding was mentioned within the form.

I received a reply from HCC Benefits Consulting stating - "The bank is no longer issuing checks with no withholding unless the participant has a registered ITIN # - so if their current tax treaty is zero percent they will withhold 30% from their interest and earning ONLY - they can try and obtain that withholding back by filling out a 1040NR form which can be obtained through the IRS. He will need to fill out the application for distribution and the W8Ben form - HE MUST POST THE ORIGINALS BACK THE BANK WILL NOT ACCEPT A FAXED SIGNATURE COPY." - which was of course a bit of a shock!

I requested some clarification regarding the above and received the following - "If he is rolling his monies over to an IRA or another qualified plan – HE WILL NOT BE TAXED. An ITIN # is a number that a non-U.S. resident can apply for with the IRS (Form W-7) I have this form available and would be glad to mail it to him along with the other forms, but this form will need to be returned to the Internal Revenue Service (for his ITIN to be assigned to him) before he returns the Application for Distribution and the W8Ben Form. Otherwise there will be withholding on his INTEREST AND EARNINGS ONLY - if he is in a zero percent tax treaty the bank will withhold 30%. After he receives the check he can obtain a Form 1040NR from the Internal Revenue Service to try and obtain his withholding back. This is not our decision this is the decision of the bank who issues the checks for Western Atlas."

I contacted the IRS directly in an attempt to confirm the procedure. I spoke to an extremely helpful guy (Mr Clough) in Philadelphia who said that I should only have to submit a W-8Ben form stating that I am not a US citizen and not liable for any withholding. It was suggested that the bank should honour this document.
If the bank chooses not to honour the W-8Ben form then the procedure is that one must submit a W-7 then 1040NR form. One must quote US-UK treaty article 18.
Basically the W-7 form is to apply for an ITIN and the 1040NR is to claim back the monies withheld.
I was also told that if a withholding occurs then the bank must issue a 1042S form which should state the amount withheld. It was the opinion of the IRS guy that the bank should not withhold any tax at all, or if absolutely necessary, they should honour the W-8Ben document.

It would seem that this is all good old CYA. The bank are ensuring their non-liability for tax and passing the problem on to ourselves and the IRS.

The following are downloadable copies of all the forms you may require. Well, as far as I have been led to believe at this time. You can use this link - fill in on line - and complete the forms using your computer on line if you prefer.
I will update this page as and when I receive more information and also let you know how I get on with my application. You can email me for contact addresses or if you have any questions.

Application for Distribution form.
Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding - (W-8Ben)
Instructions for completing the W-8Ben form.
 
Application for IRS Individual Taxpayer Identification Number - (W-7 ITIN)
 
U.S. Nonresident Alien Income Tax Return
Instructions for completing the 1040NR form.

IRS Web site

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