Daily Tax Update - July 9, 2015: US and India Sign Model 1 FATCA Agreement

US and India Sign Model 1 FATCA Agreement:  After lengthy delays, India and the US signed an intergovernmental agreement to implement the Foreign Account Tax Compliance Act.  The agreement becomes effective October 1 and requires India to report to the IRS specified information about US accounts maintained by financial institutions in India.

IRS to Prohibit Some Pension Lump-Sum Payments:  In Notice 2015-49, the IRS announced its intention to amend the required minimum distribution rules under section 401(a)(9) to provide that qualified defined benefit plans generally are not permitted to replace any joint and survivor, single life, or other annuity currently being paid with a lump sum payment or other accelerated form of distribution.

Working Group Seeking Comments on Tax Incentives in Low-Income Countries:  The IMF, OECD, UN, and World Bank are soliciting comments on a draft report on options for low income countries’ effective and efficient use of tax incentives for investment.  The report, commissioned by the G20’s Development Working Group, aims to develop principles for the design and governance of tax incentives and to provide guidance on good practices.