W9 form and W8 form: What are these?
W-9 Form
A W-9 form is an Internal Revenue Service (IRS) tax form used to confirm a person’s name, address, and taxpayer identification number (TIN) or Social Security Number (SSN) for employment or other income-generating purposes. Officially known as the Request for Taxpayer Identification Number and Certification form, it serves multiple purposes.
Why Do You Need a W-9 Form?
Use Form W-9 to provide your correct TIN or SSN to the person who needs to file an information return with the IRS. This could include:
- Income paid to you
- Real estate transactions
- Mortgage interest you paid
- Acquisition or abandonment of secured property
- Cancellation of debt
- Contributions you made to an IRA
You can find more information about the W-9 form on Investopedia and download the form from the IRS website.
W-8 Form
W-8 forms are IRS forms that foreign individuals and businesses must file to verify their country of residence for tax purposes, certifying that they qualify for a lower rate of tax withholding. These forms are submitted to payers or withholding agents, not the IRS.
Why Do You Need a W-8 Form?
Foreign individuals are typically subject to a tax rate of 30% on specific types of income they receive from U.S. payers, including:
- Interest
- Dividends
- Rents
- Royalties
- Premiums
- Annuities
- Compensation for services rendered
The form also helps claim a reduction or exemption from U.S. tax withholding if you reside in a country with which the United States has an income tax treaty and the income is subject to that treaty.
Foreign persons must provide Form W-8BEN to the withholding agent or payer if they are the beneficial owner of the income subject to tax withholding. Submitting the form is required before receiving income or credits; otherwise, you might be subjected to the full 30% rate or backup withholding under section 3406.
You can find more information about the W-8 form is available on Investopedia, and download the form from the IRS website.
Some banks may require clients to provide these forms to comply with reporting requirements. If you need help with these forms, please contact a tax advisor. Startxpress partners with experts who can assist you with your company’s tax requirements.
For further insights, explore the Startxpress Help Center and Blog. If you have questions or need support, reach out anytime at support@startxpress.io!
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