Hi. How does the United States’ IRS monitor brokerage/bank accounts opened at US-situated financial institutions by non-resident aliens who have never even been to the US and therefore are not in any way officially registered with the IRS or any other governmental institution in the US? Do they perform routine audits of such accounts or else are American financial institutions responsible for periodically reporting on non-resident alien’s accounts (e.g. transactions made, taxes due, etc.)?
When foreign customer fills out an application, they are required to fill out a W8BEN. https://www.irs.gov/forms-pubs/about-form-w-8-ben. I expect this is submitted to the IRS as the customer is subject to NRA withholding of Dividend payments.