For financial institutions dealing in US equity based derivative contracts for non-US clients, Meritsoft’s 871(m) tax module:

• Simplifies and automates complex 871(m) tax calculations.
• Ensures accuracy and quality of 871(m) tax reported numbers.

Unlike other vendors in the market, 871(m) is the only solution configured to:

• Facilitate proactive case management.
• Streamline workflow.
• Adhere to regulatory compliance demands.
• Automate the processing of tax payments and settlement of balances.

As a result you can be assured of accuracy of 871(m) tax payments. Furthermore you will not overpay or under recoup.

Reduce time lost to 871(m) tax preparation and the number of manual errors

Guide operations teams through a configurable STP workflow process that manages:

• Authorisations: Generate receivables so that you can recover tax. Also generate payables to the relevant tax authorities.
• Approvals: Generate notifications/statements to clients.

At the same time appropriately realise, document and maintain 871(m) tax efficiency opportunities.

Ensure accuracy and quality of 871(m) tax reported numbers

Secure full visibility of your 871(m) tax status.

• Capture IRS in-scope transactions that could give rise to 871(m) tax.
• Identify transactions and baskets that meet relevant criteria.
• Source/hold relevant static (components, deltas, div events etc.)
• Enable breaking of indexes, by weighting & holding expanded data.
• Reference relevant tax rate static including WHT/DTT.
• Calculate “Dividend Equivalent WHT” based on IRS rules.
• Determine combination trades across previous 2-day window.
• Hold delta history for combined trades.