Part II. Treaties and Tax Legislation

Subpart A.—Tax Conventions

Supplemental Tables of Income Tax Rates and Exempt Personal Service Income Under New Income Tax Treaties and Protocols

Announcement 98–47

The United States recently exchanged instruments of ratification for new income tax treaties with the following countries. This table shows the effective dates of those new treaties.

Canada. The United States also recently exchanged instruments of ratification for a new protocol with Canada. The protocol changes the taxation of social security benefits (including tier 1 railroad retirement benefits but not including unemployment benefits). Beginning January 1, 1998, tax will not be withheld from these benefits. In addition, Canadian residents can request refunds of U.S. tax withheld for 1996 and 1997 from the Canadian government. Contact Revenue Canada for information on the refund procedure.

Tables. The Internal Revenue Service prepared Tables 1 and 2 below, as an aid in determining the taxability of certain types of income under the treaties. Table 1 lists tax rates for investment income such as dividends, interest, and royalties. Table 2 lists the different kinds of personal service income that may be fully or partially exempt from U.S. tax.

These tables are similar in format to Tables 1 and 2 in the 1997 editions of Publication 515, Withholding of Tax on Nonresident Aliens and Foreign Corporations, and Publication 901, U.S. Tax Treaties. Taxpayers and withholding agents may use these tables until the Service revises Publications 515 and 901.

National Director, Tax Forms and Publications Division T:FS:FP

1998–23 I.R.B. 5 June 8, 1998

1998–23 I.R.B. 7 June 8, 1998

June 8, 1998 8 1998–23 I.R.B.