New 1446(f) regulations
What is the Section 1446(f) regulations?
Section 1446(f) of the U.S. Internal Revenue Code imposes new withholding and reporting requirements on sales of partnership interest. Generally, the securities affected are classified as partnerships for U.S. tax withholding purposes. Such securities include Master Limited Partnerships (MLP), Publicly Traded Partnerships (PTP), and Exchange Traded Funds (ETF).
Current section 1446 regulations already extend to include withholding on partnership distributions. Starting 01/01/2023, additional requirements include a new 10% withholding tax on distributions and 10% withholding tax on proceeds from partnership securities.
Who is affected by the 1446(f) regulations?
Any foreign accounts holding securities that are in scope for section 1446(f) will be subject to additional withholding requirements on and after 01/01/2023.
What are the 1446(f) securities?
CUSIP | Security Name | Symbol |
---|---|---|
026695106 | ***AMERICAN HOTEL INCOME PROP REIT LP UNITS | AHOTF |
131476103 | CALUMET SPECIALTY PRODS PARTNERS L P COMMON UNITS REPSTG LTD PARTNER INT | CLMT |
150185106 | CEDAR FAIR LP-DEP RCPTS REPSTG UNITS LTD PARTNERSHIP INT | FUN |
153423108 | CENTRAL ENERGY PARTNERS LP | ENGY |
165185109 | CHESAPEAKE GRANITE WASH TRUST COMMON SHARES | CHKR |
172464109 | CINER RESOURCES LP COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | CINR |
212849103 | CONWEST PARTNERSHIP PART UNITS | CWPS |
226344208 | CRESTWOOD EQUITY PARTNERS LP COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | CEQP |
226344307 | CRESTWOOD EQUITY PARTNERS LP PREFERRED UNITS REPRESENTING LIMITED PARTNER INTERE | CEQPPR |
232751107 | CYPRESS ENVIRONMENTAL PARTNERS L P COMMON UNITS REPRESENTING LIMITED PARTNER INT | CELP |
292102100 | EMPIRE STATE REALTY OP L P SER ES OPERATING PARTNERSHIP UNITS REP LTD PARTNERSHI | ESBA |
292102209 | EMPIRE STATE REALTY OP L P SER 60 OPERATING PARTNERSHIP UNITS REP LTD PARTNERSHI | OGCP |
292102308 | EMPIRE STATE REALTY OP L P SER 250 OPERATING PARTNERSHIP UNITS REP LTD PARTNERSH | FISK |
292480100 | ENABLE MIDSTREAM PARTNERS LP COM UNIT REPSTG LTD PARTNER INT | ENBL |
293792107 | ENTERPRISE PRODUCTS PARTNERS LP | EPD |
315293100 | Ferrellgas Partners, L.P. | FGPR |
315293308 | UTS FERRELLGAS PARTNERS L P UNIT LTD PARTNERSHIP INT CL B | FGPRB |
371927104 | GENESIS ENERGY LP UNITS LTD PARTNERSHIP INT | GEL |
393221106 | GREEN PLAINS PARTNERS LP COM UNIT REPSTG LTD PARTNER INT | GPP |
403829104 | GYRODYNE LLC COM | GYRO |
428103105 | Hess Midstream LP (1) | HESM |
435763107 | HOLLY ENERGY PARTNERS L P UNIT REPSTG LIMITED INTEREST | HEP |
451100101 | ICAHN ENTERPRISES L P | IEP |
505346106 | LAACO LTD-UNIT LTD PARTNERSHIP INT | LAACZ |
559080106 | MAGELLAN MIDSTREAM PARTNERS LP UNIT REPSTG LTD PARTNER | MMP |
573331105 | MARTIN MIDSTREAM PARTNERS L P | MMLP |
644206104 | NEW ENGLAND REALTY ASSOCIATES LP-DEPOSITARY RCPT | NEN |
674001300 | OAKTREE CAPITAL GROUP LLC 6.625% SERIES A PREFERRED UNITS | OAKPRA |
674001409 | OAKTREE CAPITAL GROUP LLC 6.550 % SERIES B PREFERRED UNITS | OAKPRB |
718549207 | PHILLIPS 66 PARTNERS LP COM UNIT REPSTG LTD PARTNERSHIP INT | PSXP |
726503105 | PLAINS ALL AMERICAN PIPELINE L P COMMON UNITS REPRESENTING LIMITED PARTNER INTER | PAA |
822634101 | SHELL MIDSTREAM PARTNERS L P UNIT LTD PARTNERSHIP INT | SHLX |
849343108 | SPRAGUE RESOURCES LP UNITS | SRLP |
864482104 | SUBURBAN PROPANE PARTNERS LP UNITS LTD PARTNERSHIP INT | SPH |
866142409 | SUMMIT MIDSTREAM PARTNERS LP COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | SMLP |
903318103 | USD PARTNERS LP COM UNIT REPSTG LTD PARTNER INTS | USDP |
911717106 | UNITED STS COMMODITY INDEX FD COMMODITY INDEX FD | USCI |
911717106 | United States Commodity Index Fund | USCI |
911718104 | UNITED STS COMMODITY INDEX FDS COM UNIT REPSTG U S COPPER INX FD | CPER |
911718104 | United States Copper Index Fund | CPER |
912318300 | United States Natural Gas Fund | UNG |
958669103 | WESTERN MIDSTREAM PARTNERS LP COMMON UNITS REPRESENTING LIMITED PARTNER INTEREST | WES |
960417103 | WESTLAKE CHEMICAL PARTNERS LP COM UNIT REPSTG LTD PARTNER INT | WLKP |
6.49E+113 | NEW SOURCE ENERGY PARTNERS L P COM UNIT REP LIMITED PARTNERSHIP INT | NSLPQ |
00162Q452 | Alerian MLP ETF | AMLP |
00162Q676 | ALPS Alerian Energy Infrastructure ETF | ENFR |
01877R108 | ALLIANCE RESOURCE PARTNERS L P UNIT LTD PARTNER INT | ARLP |
01881G106 | ALLIANCEBERNSTEIN HOLDING LP UNIT LTD PARTNERSHIP INT | AB |
02364V107 | AMERICA FIRST MULTIFAMILY INVESTORS L P BENEFICIAL UNIT CERTIFICATES | ATAX |
0556EL109 | BP MIDSTREAM PARTNERS LP COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | BPMP |
09225M101 | BLACK STONE MINERALS L P COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | BSM |
09625U109 | BLUEKNIGHT ENERGY PARTNERS LP L L C | BKEP |
09625U208 | BLUEKNIGHT ENERGY PARTNERS L P L L C SERIES A PREFERRED UNITS | BKEPP |
12637A103 | CSI COMPRESSCO LP COMMON UNITS | CCLP |
16411Q101 | CHENIERE ENERGY PARTNERS L P COMMON UNITS | CQP |
22758A105 | CROSSAMERICA PARTNERS LP COMMON UNITS REPSNTNG LIMITED PARTNER INTERESTS | CAPL |
23311P100 | DCP MIDSTREAM LP COMMON UNITS REPRESENTING LIMITED PARTNERSHIP INTERESTS | DCP |
23311P209 | DCP MIDSTREAM LP 7.875% RED PERP CUM PFD UNIT SER B FIXED/FLTG SHS | DCPPRB |
23311P308 | DCP MIDSTREAM LP 7.95% SERS C FXD TO FLTNG RATE CUM REDMBLE PRPTUAL PREF UNITS | DCPPRC |
24664T103 | DELEK LOGISTICS PARTNERS LP COM UNIT REPSTG LTD PARTNERSHP INT | DKL |
25820R105 | DORCHESTER MINERALS L P | DMLP |
26827L109 | ECA MARCELLUS TR I UNIT | ECTM |
26923G772 | InfraCap MLP ETF | AMZA |
29273V100 | ENERGY TRANSFER LP COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | ET |
29273V407 | ENERGY TRANSFER LP 7.375% SRS C FXD TO FLTNG RATE CMLTV RDMBL PERPETUAL PREF UNT | ETPRC |
29273V506 | ENERGY TRANSFER LP 7.625% SRS D FXD TO FLTNG RT CMLTV RDMBL PERPETUAL PREF UNT | ETPRD |
29273V605 | ENERGY TRANSFER LP 7.600% SRS E FXD TO FLTNG RT CMLTV RDMBL PERPETUAL PREF UNT | ETPRE |
29414J107 | ENVIVA PARTNERS LP COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | EVA |
34960P101 | FORTRESS TRANSPORTATION AND INFRASTRUCTURE INVESTORS LLC | FTAI |
34960P200 | FORTRESS TRANSPORTATION AND INFRASTRUCTURE INVESTORS LLC 8.25% FXDTFLTNG RT SRS | FTAIPRA |
34960P309 | FORTRESS TRANSPORTATION AND INFRASTRUCTURE INVESTORS LLC 8.00% FXD TO FLTNG SRS | FTAIPRB |
34960P408 | FORTRESS TRANSPORTATION AND INFRASTRUCTURE INVS LLC CUM 8.25% FXD RT SRS C CMLTV | FTAIPRC |
37946R109 | GLOBAL PARTNERS LP UNIT REPSTG LTD PARTNER INT | GLP |
37946R208 | GLOBAL PARTNERS LP 9.75% SRS A FXD TO FLTNG RT CMLTV RDMBL PRPTL PRFRD UNTS | GLPPRA |
37946R307 | GLOBAL PARTNERS LP 9.50% SRS B FXD RT CMLTV RDMBL PERPETUAL PREFERRED UNITS | GLPPRB |
37954Y293 | Global X MLP & Energy Infrastructure ETF | MLPX |
37954Y343 | Global X MLP ETF | MLPA |
37959R103 | GLOBAL INDEMNITY GROUP LLC CLASS A COMMON STOCK | GBLI |
46138B103 | INVESCO DB COMMODITY INDEX TRACKING FD UNIT | DBC |
46139B102 | INVESCO DB G10 CURRENCY HARVEST FUND INVESCO DB G10 CURRENCY HARVEST FUND | DBV |
46140H106 | INVESCO DB MULTI SECTOR COMMODITY TRUST INVESCO DB AGRICULTURE FUND | DBA |
46140H205 | INVESCO DB MULTI-SECTOR COMMODITY TRUST INVESCO DB SILVER FUND | DBS |
46140H304 | INVESCO DB MULTI SECTOR COMMODITY TRUST INVESCO DB ENERGY FUND | DBE |
46140H403 | INVESCO DB MULTI SECTOR COMMODITY TRUST INVESCO DB OIL FUND | DBO |
46140H502 | INVESCO DB MULTI SECTOR COMMODITY TRUST INVESCO DB PRECIOUS METALS FUND | DBP |
46140H601 | INVESCO DB MULTI SECTOR COMMODITY TRUST INVESCO DB GOLD FUND | DGL |
46140H700 | INVESCO DB MULTI SECTOR COMMODITY TRUST INVESCO DB BASE METALS FUND | DBB |
46141D104 | INVESCO DB US DOLLAR INDEX TRUST INVESCO DB US DOLLAR INDEX BEARISH FUND | UDN |
46141D203 | INVESCO DB US DOLLAR INDEX TRUST INVESCO DB US DOLLAR INDEX BULLISH FUND | UUP |
46428R107 | ISHARES S&P GSCI COMMODITY INDEXED | GSG |
46625H365 | JPMorgan Alerian MLP ETN | AMJ |
51508J108 | LANDMARK INFRASTRUCTURE PARTNERS LP COM | LMRK |
51508J207 | LANDMARK INFRASTRUCTURE PARTNERS LP 8% RED PERP PFD UNIT SER A | LMRKP |
51508J306 | LANDMARK INFRASTRUCTURE PARTNERS LP PERPETUAL PREFERRD UNITS SERIES B 7.90% | LMRKO |
51508J405 | LANDMARK INFRASTRUCTURE PARTNERS LP 7% SRS C FLTG FXD PERPETUAL CONV PREFERRED S | LMRKN |
55336V100 | MPLX LP COM UNIT REPSTG LTD PARTNER INT | MPLX |
55608B105 | MACQUARIE INFRASTRUCTURE HOLDINGS LLC COMMON UNITS | MIC |
59140L100 | METAURUS EQUITY COMPONENT TRUST U S CUMULATIVE DIVIDENDS FUND SERIES 2027 SHARES | IDIV |
59560V208 | Mid-Con Energy Partners, LP | MCEP |
62913M107 | NGL ENERGY PARTNERS LP COM UNIT REPSTG LTD PARTNER INT | NGL |
62913M206 | NGL ENERGY PARTNERS LP 9.00% CL B FXD TO FLTNG CMLTV RDMBL PRPTL PFRD UNTS | NGLPRB |
62913M305 | NGL ENERGY PARTNERS LP 9.625% CL C FXD TO FLTNG CMLTV RDMBL PRPTL PFRD UNTS | NGLPRC |
63900P608 | NATURAL RESOURCE PARTNERS L P COM UNIT LTD PARTNERSHIP INT NEW | NRP |
64881E307 | NEW SOURCE ENERGY PARTNERS L P 11.00% SER A CMLTV CNVRTBL PFD UNITS | NUSPQ |
67058H102 | NUSTAR ENERGY L P COM UNITS REPSTG LTD PRTNR INT | NS |
67058H201 | NUSTAR ENERGY LP 8.50% SERIES A FIXED TO FLOATING RATE CUM RED PFD UNIT | NSPRA |
67058H300 | NUSTAR ENERGY LP 7.625% SRS B FXD TO FLTG RATE CUM RDMBL PRPTL PRFRRD UNITS | NSPRB |
67058H409 | NUSTAR ENERGY LP 9.00% SRS C FXD TO FLTG RATE CUM RDMBL PRPTL PRFRRD UNITS | NSPRC |
67081B106 | Sisecam Resources LP | SIRE |
67420T206 | OASIS MIDSTREAM PARTNERS LP COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | OMP |
69318Q104 | PBF LOGISTICS LP UNIT LTD PARTNERSHIP INT | PBFX |
74347W338 | PROSHARES TR II PROSHARES VIX MID TERMFUTURES ETF | VIXM |
74347W353 | PROSHARES ULTRA SILVER | AGQ |
74347W395 | PROSHARES TR II PROSHARES ULTRASHORT GOLD | GLL |
74347W460 | PROSHARES ULTRASHORT AUSTRALIAN DOLLAR | CROC |
74347W569 | PROSHARES TR II PROSHARES ULTRASHORT YEN | YCS |
74347W742 | PROSHARES SHORT EURO | EUFX |
74347W874 | PROSHARES TR II PROSHARES ULTRA EURO | ULE |
74347W882 | PROSHARES TR II PROSHARES ULTRASHORT EURO | EUO |
75419T103 | Rattler Midstream LP | RTLR |
76090H103 | ***RESTAURANT BRANDS INTERNATIONAL INC UNIT LTD PARTNERSHIP INT | RSTRF |
76218Y202 | RHINO RESOURCE PARTNERS LP COM | RHNO |
79971C201 | Sanchez Midstream Partners LP | SNMP |
80007A102 | SANDRIDGE PERMIAN TR COM UNIT REPSTG BENEFICIAL INTS IN SANDRIDGE TR | PERS |
80007T101 | SANDRIDGE MISSISSIPPIAN TR I UNIT | SDTTU |
85814R107 | STEEL PARTNERS HOLDINGS LTD PARTNERSHIP UNIT | SPLP |
85814R206 | STEEL PARTNERS HOLDINGS LP 6.0% SERIES A PREFERRED UNITS | SPLPPRA |
86183Q100 | StoneMor Partners LP | STON |
86765K109 | SUNOCO LP COMMON UNITS REPRESENTING LIMITED PARTNER INTERESTS | SUN |
88166A102 | TEUCRIUM COMMODITY TR CORN FD SHS | CORN |
88166A409 | TEUCRIUM COMMODITY TR SUGAR FD | CANE |
88166A508 | TEUCRIUM COMMODITY TR WHEAT FD | WEAT |
88166A607 | TEUCRIUM COMMODITY TR SOYBEAN FD | SOYB |
88166A706 | TEUCRIUM COMMODITY TR AGRICULTURAL FD | TAGS |
90290N109 | USA COMPRESSION PARTNERS LP COM UNIT LTD PARTNER INTSLTD | USAC |
90290T882 | USCF Midstream Energy Income Fund ETF | UMI |
91167Q100 | UNITED STS BRENT OIL FD LP UNIT | BNO |
91167Q100 | United States Brent Oil Fund | BNO |
91201T102 | UNITED STATES GASOLINE FUND LP ETF | UGA |
91201T102 | United States Gasoline Fund | UGA |
91232N207 | United States Oil Fund | USO |
91288V103 | UNITED STATES 12 MONTH OIL FUND LP UNIT BEN INT | USL |
91288V103 | United States 12-Month Oil Fund | USL |
91288X109 | UNITED STS 12 MONTH NAT GAS FD UNIT BEN INT | UNL |
91288X109 | United States 12-Month Natural Gas Fund | UNL |
G16234109 | ***BROOKFIELD BUSINESS PARTNERS L P LIMITED PARTNERSHIP UNITS | BBU |
G16249149 | ***BROOKFIELD PPTY PARTNERS LP 6.50% SER A CUM REDMBLE PFD | BPYPP |
G16249156 | ***BROOKFIELD PPTY PARTNERS LP 6.375% SER 2 CL A CUM REDMBLE PFD | BPYPO |
G16252101 | ***BROOKFIELD INFRASTRUCTURE PARTNERS L P UNITS | BIP |
G16258108 | ***BROOKFIELD RENEWABLE PARTNERS L P | BEP |
G54050102 | ***LAZARD LTD SHS A | LAZ |
Y11082206 | Capital Product Partners LP (1) | CPLP |
Y2188B108 | Dynagas LNG Partners LP (1) | DLNG |
Y2687W108 | GasLog Partners LP (1) | GLOP |
Y3262R100 | Hoegh LNG Partners LP (1) | HMLP |
What happens if a foreign customer holds 1446(f) in scope securities after January 1, 2023?
If the 1446(f) partnership security declares a distribution, that distribution may potentially be subject to the new 10% withholding tax on ECNI. ECNI is defined as excess cumulative net income earned by a publicly traded partnership since its formation that has not been previously.
Foreign customer may be subject to 10% withholding tax on their proceeds when selling their units.
How can customers reclaim funds as a result of 1446(f) withholding?
Legitimate withheld funds will be remitted to the IRS and, by the tax reporting season, foreign customers will get a 1042-S slip. You may consult with your tax advisors and file a U.S. tax return to reclaim any potential over withholding.
Does the 1446(f) withholding apply to option exercise and assignments?
Option exercise or assignments are not subject to the 1446(f) withholding. However, if you receive shares from exercising or being assigned those options and subsequently sell the shares in the future then the 10% withholding will be applied on those sales.
The 10% withholding would still apply to proceeds from closing option contracts.
When would I see the withholding after a sale?
1446(f) withholding usually happens the day following the settlement day of the sale.