US IRS W9 and W8 Series of Forms
All Medici Bank clients must provide a completed W8 or W9 Series form, as applicable. Below are the links and general information about the form.
Fill the W9 form if any of the following apply to you
•An individual who is a U.S. citizen or U.S. resident alien;
•A partnership, corporation, company, or association created or organized in the United States or under the laws of the United States;
• An estate (other than a foreign estate); or
• A domestic trust (as defined in Regulations section 301.7701-7)
Latest W9 Form with Instructions
Fill the W8 Series Form if any of the following apply to you.
- Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals). Instructions
- Form W-BEN-E, Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities).Instructions
- Form W-8ECI, Certificate of Foreign Person's Claim That Income Is Effectively Connected With the Conduct of a Trade or Business in the United States. Instructions
- Form W-8EXP, Certificate of Foreign Government or Other Foreign Organization for United States Tax Withholding and Reporting. Instructions
- Form W-8IMY, Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding and Reporting. Instructions
What is a W-8BEN-E Form?
The form W-8BEN-E is also called a Certificate of Foreign Status of Beneficial Owner for U.S. Tax Withholding. It’s an important document that enables a business operating outside of the U.S. to claim tax exemption on U.S.-sourced income.
The Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities) a.k.a. Form W-8BEN-E is used by a foreign person to establish beneficial ownership and foreign status.
It’s also used to claim income tax treaty benefits with respect to income (other than compensation for personal services).
The Difference Between a W-8BEN and a W-8BEN-E Form?
These two forms differ in a very specific way: the W-8BEN form is only used for foreign individuals or sole proprietors, while the W-8BEN-E form is for non-US entities, like businesses, companies, and organizations.
The W-8BEN tax form works to:
• Establish that an individual or sole proprietor qualifies as a foreign person subject to the tax rate of 30% on domestic income earned by a foreign entity.
• Claim that an individual or sole proprietor is an NRA (nonresident alien).
While both forms require very similar information, the W-8BEN-E form is longer. It also requires a detailed description of the foreign business entity involved.
What is a W-8BEN-E Form Used For?
The motivation behind filing the W-8BEN-E is to document status for tax reporting purposes. It’s an IRS mandated form that collects the correct data, including the Nonresident Alien (NRA) taxpayer information for businesses for the purpose of accurate reporting and collection.
Who Needs to Fill Out a W-8BEN-E?
Any foreign (non-U.S.) company that receives payment from an American business must fill out the W-8BEN-E form and send it to the Internal Revenue Service (IRS).
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How Do I Fill Out a W-8BEN-E?
Any foreign entity doing business with the United States must fill out a W-8BEN-E form. The document can be downloaded at www.irs.gov and completed online or by hand.
The W8BEN-E form has 30 different parts with multiple pages, so if you’re unsure, it’s best to hire a U.S. tax advisor for solid tax advice. Most foreign entities only need to fill in 4 parts, according to the entity type.
Below are some brief instructions on how to fill in the top required parts of the form in less than 10 minutes:
Part I – Identification of Beneficial Owner
This is the most important section of the W-8BEN-E form. It must be a complete part when turning in the paperwork. Take your time here to ensure all data is accurate and in the right spot.
1. Name of the Organization
This is the foreign entity name.
2. Country of Incorporation
This is the country of residence (where the business is registered).
3. Name of a Disregarded Entity
This is only filled out when a third party is receiving payment. When payment is not made directly to the foreign entity and goes through foreign or U.S. sources, like an accounting institution, then this section should not be skipped.
*If there is a third party, Part ii will need to be filled out as well. This section simply asks you to elaborate on the Disregarded Entity or Branch Receiving Payment. This includes:
- Chapter 4 status
- Address (no P.O. box)
- GIIN (if any)
4. Chapter 3 Status
In this section, the most commonly checked box is “Corporation”. The majority of foreign entities that are doing business fall under “Corporation” or “Partnership” status. Other options include:
- Foreign government
- Simple trust (grantor and complex too)
- Central Bank of Issue
- Tax-exempt organization
- Private foundation
- International organization
If nothing seems to fit, it’s best to check “Corporation” if the business is solely owned, or “Partnership” if it’s owned by several people.
5. Chapter 4 Status (FATCA Status)
The most common choice here is Active NFFE. This means the business is an Active Non-Financial Foreign Entity. If none of the other categories fit, Active NFFE is the best option.
Your FATCA (Foreign Account Tax Compliance Act) status will determine which parts of the W8BEN-E form you fill out later.
If the company is not a Foreign Financial Institution (FFI) (bank, insurance, or investment fund), then all the options containing FFI can be ignored.
6. Permanent Residence Address
Same as above. This is the foreign company’s address.
7. Mailing Address
Skip this section if it is the same as the permanent residence address.
8-10. Tax Identification Information (foreign TIN)
As a non-US entity, chances are there is no U.S. taxpayer identification number. In this case, the number local tax authorities use to identify the business should be filled in. The vendor must find this on their own foreign tax returns or paperwork.
Part III – Claim of Tax Treaty Benefits
This is for Chapter 3 purposes only. In this section, you simply need to check the appropriate boxes and fill in the country of origin.
- 14a – check the box and fill in the country
- 14b – check the box only
Part XXV – Active NFFE
In this part of the form you simply need to check box 39 to certify that:
- The entity in Part I is a foreign entity that is not a bank or financial institution
- Less than 50% of the gross income for the preceding calendar year is passive income
- Less than 50% of assets held are assets that produce or are held for the production of passive income (calculated as a weighted average of the % of quarterly passive assets).
*It should be noted that Part XXIX deals with Passive NFFE and differs entirely from Part XXV above.
Part XXX – Certification
The most important part of the document is the signature. Here, in writing, there needs to be a first name, last name, and date (in which the form was signed).
Still have questions?
Click here for full IRS instructions on filling out the W8BEN-E form.
For How Long is a W-8BEN-E Valid?
The simplest answer is three years. It starts on the date the W-8BEN-E is signed and ends three consecutive years from that date. It expires on the last day of the third calendar year.
*It should be noted, if any changes in circumstance cause the data on the form to be incorrect, it will render the entire document invalid.
What Happens if You Don’t Fill Out a W-8BEN-E Form?
The United States government highly incentivizes all foreign entities to fill out a W-8BEN-E form and to do so accurately.
Failure to submit a document (or submitting an inaccurate one) means the foreign company must pay the full 30% tax rate. It can also lead to a different, backup withholding rate, as outlined in section 3406, and a limitation on benefits.
Clearly, in this case, due diligence is in order.