Of all the changes, the following have the greatest business, operational and systems impact:

• Under the "address" rule, you never had to collect any documentation from customers before relieving the tax on dividends – you could rely on the address of the recipient. The "address" rule is eliminated, meaning that you must now set up procedures to collect beneficial owner documentation before you can grant treaty relief.
• Forms that have been in use for decades (e.g., Form 1001, 4224, W-8) are being phased out and replaced with forms – a non-U.S. person must use one of four forms to establish non-U.S. status and claim a reduced rate of NRA withholding, if applicable. They are Form W-8BEN, W-8ECI, W-8EXP, and W-8IMY.
• When received from customers, the forms must be reviewed using detailed validity criteria prescribed by the IRS. For example, a Form W-8BEN with a U.S. mailing address is not valid documentation. Storing forms without validating them could cause an institution to grant withholding relief improperly, resulting in tax liability as well as interest and penalties.
• When paying interest on U.S. Treasury or corporate debt obligations to a non-U.S. financial institution, you may have granted a withholding exemption based on a single Form W-8. Under the rules, financial institutions must now obtain Forms W-8BEN or W-9 from all underlying beneficial owners before they can give a tax exemption for bond interest (and any other so-called "portfolio interest").