The Internal Revenue Service continues to ramp up its enforcement of cross-border withholding taxes for foreign nationals working in U.S. companies. Corporate tax departments should be ready for the challenges and changes ahead.
The IRS, which has been boosting its enforcement priorities in cross-border withholding for several years, formally designated the issue as a Tier 1 audit concern (a label the IRS applies to high priorities) in December 2008. It has also placed greater focus on training and hiring more agents to examine withholding issues.
