US companies hiring labor and services in the United States must submit reports and forms to the US government in the early days of each new fiscal year.
Forms W-2, W-8, W-9 and 1099 are essential documents to keep up with the American Treasury. Get to know them better next.
Employers need to fill out form W-2 for each salaried employee, informing the amount of remunerations, payments and other compensation paid in 2018.
With a January 31 deadline, taxpayers have enough time to prepare their income tax return until the 15th of April.
Forms W8BEN and W8BEN-E
The IRS generally subject foreigners to their Income Tax at a rate of 30% on incomes received from domestic sources. Form W8BEN exists to allow individuals to claim eligibility for reduced rates or tax exemptions, and form W8BEN-E does the same for legal entities.
Attention: forms W8BEN and W8BEN-E should not be sent to the IRS. Refer them to the person who will make the payment to you for the product and/or service sold.
Form W-9 must be completed by autonomous service providers or companies which provide services to other business entities.
Attention: this form is also not sent to the IRS, but rather to your consumer or client, so that you can issue a 1099 form at the end of the tax year.
Form 1099 does the opposite of Form W-9: it reports payments to external service providers who received more than US$ 600 over the course of the fiscal year.
It should not include wages, salaries or tips — which must be informed by means of Form W-2.
It is important to submit all forms and documents required by the IRS so that employees and service providers can file their taxes in the US. Delay in submitting these forms results in high fines for the employer or contractor.
Is your company up to date with the American tax authorities?
Send an email to firstname.lastname@example.org and learn how to meet all tax obligations on time.