W-8 and W-9 Series Forms for Individual Taxpayers and Foreign Withholding Rules

U.S. businesses making certain payments are required to obtain a Form W-8BEN or other W-8 (foreign entities or individuals), or a Form W-9 (U.S. taxpayers), bearing certain information about the payee. The forms, when properly filed, reduce or eliminate U.S. federal income tax withholding.

Form W-8BEN is part of the increasingly complex foreign information reporting regime, and the IRS integrates and cross-references W-8BEN filings with other information requirements, including FATCA requirements. IRS audit activity is aggressive in this area, and tax professionals need to grasp reporting obligations to file Form W-8BEN. A key challenge is determining when the forms are required from foreign and U.S. payees and when tax withholding is or isn't required.

Form W-8BEN requires any taxpayer claiming a treaty position to specify both the article and paragraph of the tax treaty that they are referencing. Also, filers are required to furnish more detail to support any claim of special rates, citing specific article and paragraph to substantiate eligibility for the claimed rate of withholding.

Listen as Margaret Nowak, EA, MBA, MST, Director at Mueller, analyzes the upcoming new Form W-8BEN and provides insights for compliance with W-8BEN and W-9 for U.S. taxpayers.

1. U.S. withholding-related information forms individuals
   1. Form W-8BEN (certificate of foreign status of beneficial owner)
   2. Form W-9 (request for taxpayer identification number and certification)
   3. Form W-8ECI (effectively connected with U.S. trade or business)
   4. Form W-8EXP (foreign government or organization)
   5. Form W-8IMY (foreign intermediary, flow-through entity, or certain U.S. branches)
2. Required information on forms
3. When a payor may have to withhold on certain payments
4. Claiming tax treaty withholding exemptions
5. Compliance challenges with Forms W-9 and W-8BEN series

The panelist will review these and other key issues:

• Implications of the new requirement for a foreign tax identifying number
• Circumstances that require payor companies to obtain a form from payees or to withhold because they haven't received a valid form
• Tactics for performing a line-by-line review to ensure a form is accurate and complete
• When an equivalent form is acceptable--and forms that are equivalent
• Automatic exchange of information (AEoI) and W8 series/W9

Learning Objectives

After completing this course, you will be able to:

• Determine the person or entity responsible for making the withholding payment
• Recognize foreign financial institutions in the FATCA reporting process
• Identify intergovernmental agreements under FATCA
• Indicate the purpose of the W-8BEN form
• Distinguish the requirements of an active nonfinancial foreign entity for being treated as active vs. passive by the IRS
• Verify whether a taxpayer is considered a nonresident alien
• Discern qualifying grandfathered obligations under FATCA

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite: Three years+ business or public firm experience at mid-level within the organization, preparing complex tax forms and schedules regarding foreign business transactions; supervisory authority over other preparers/accountants. Knowledge and understanding of Forms W-8BEN, W-9 and W-8 compliance; familiarity with FATCA reporting and the treatment of non-financial foreign entities.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).