M&A Lawyers: help me settle a bet Forum

[Anonymous User]

Do FIRPTAs need to be wet-ink signed or are e-signatures OK? My firm's tax team says yes, the other side says no. I can't find any guidance directly on point from the IRS.

[glitched]

This thread is going to be the beginning of a fact pattern for a bar exam question.

[Res Ipsa Loquitter]

This is not legal advice.

They’re supposed to be signed in wet ink, but electronic was allowed for Covid, and now a lot of folks continue to do electronic

[Anonymous User]

(not legal advice) everyone thinks e-sigs are fine, except for fucking Cooley which will literally consider a deal killer if you refuse to give a wet ink one and make it a huge thing. Fuck Cooley.

[legalpotato]

Why ask M&A lawyers this question? Do M&A lawyers at your firm regularly get intimate with the internal revenue code of 1986, as amended, and the treasury regulations promulgated thereunder?

[Anonymous User]

This is not legal advice.

They’re supposed to be signed in wet ink, but electronic was allowed for Covid, and now a lot of folks continue to do electronic

OP here. This is not actually going to help us decide who won the bet, lol. Sounds like it's de facto that electronic is OK but there's no official guidance allowing for it.

[Anonymous User]

delete

[Anonymous User]

(not legal advice) everyone thinks e-sigs are fine, except for fucking Cooley which will literally consider a deal killer if you refuse to give a wet ink one and make it a huge thing. Fuck Cooley.

OP here--sigh. My firm is a peer firm of Cooley's and our tax folks are taking the same stance. I'm fully in support of getting rid of wet ink (forever).

[Res Ipsa Loquitter]

This is not legal advice.

They’re supposed to be signed in wet ink, but electronic was allowed for Covid, and now a lot of folks continue to do electronic

OP here. This is not actually going to help us decide who won the bet, lol. Sounds like it's de facto that electronic is OK but there's no official guidance allowing for it.

The more interesting bet is whether the government even looks at the FIRPTA certs they receive.

[Anonymous User]

delete

[Anonymous User]

Also not legal advice, but based on Google, if the form isn't listed on this page, but if it's going to the IRS, then it's going to need a wet ink signature: https://www.irs.gov/newsroom/details-on ... tain-forms

[Anonymous User]

Second-year M&A associate here. This thread is eye opening to me. I thought FIRPTA certificates were collected to include in the closing binder just in case. Did not realize that clients actually use it or know of it’s existence (and certainly was never told or thought about whether it requires a wet signature).

[Anonymous User]

Tax associate here and looked into this question more than once. The answer was always wet signature (at least at my V5) because, as an earlier post pointed out, FIRPTA cert is not on the list of forms approved for e-signature. No one wants to find themselves in a situation where the proceeds are subject to withholding because of a potentially invalid FIRPTA. The form gets mailed to the IRS, btw.

Not legal advice obviously.

[Anonymous User]

Tax associate here and looked into this question more than once. The answer was always wet signature (at least at my V5) because, as an earlier post pointed out, FIRPTA cert is not on the list of forms approved for e-signature. No one wants to find themselves in a situation where the proceeds are subject to withholding because of a potentially invalid FIRPTA. The form gets mailed to the IRS, btw.

Not legal advice obviously.

The form does not get mailed to the IRS, what are you talking about? It has to be retained for 5 years for audit purposes. I think you're thinking of a withholding certificate obtained from the IRS, which is different...

But yeah. Formal answer, you need a wet ink. Practical answer, this gets done with a fair amount of frequency without a wet ink.

This is not legal advice blah blah.

[JohnJay220]

Tax associate here and looked into this question more than once. The answer was always wet signature (at least at my V5) because, as an earlier post pointed out, FIRPTA cert is not on the list of forms approved for e-signature. No one wants to find themselves in a situation where the proceeds are subject to withholding because of a potentially invalid FIRPTA. The form gets mailed to the IRS, btw.

Not legal advice obviously.

The form does not get mailed to the IRS, what are you talking about? It has to be retained for 5 years for audit purposes. I think you're thinking of a withholding certificate obtained from the IRS, which is different...

But yeah. Formal answer, you need a wet ink. Practical answer, this gets done with a fair amount of frequency without a wet ink.

This is not legal advice blah blah.

897(c) and 1445-11T certs are actually technically supposed to be mailed to the IRS within 30 days of execution. there are loads of folks who don't do this, but it is required.