You might be paying for services, grants, royalties, scholarships, rents, or interest … and you might think of the payees as foreign students or researchers, foreign visitors, foreign vendors, foreign owners, or simply as foreign nationals … but for all of them, you have serious due diligence obligations to document their tax status and withhold U.S. income tax where required.
Individuals use IRS Form W-8BEN or Form 8233 for tax certification purposes but the two forms are very different. And, tax treaty claims of reduced withholding must be validated according to tax regulations. Accepting an incorrect or non-valid form exposes your organization to 30% tax liability and additional penalties.
Join this educational webinar for authoritative and practical information that can help your organization avoid the costly risks of relying on the wrong form or an incomplete form from a foreign individual payee.
- Do you need the W-8BEN or 8233? The W-8BEN is shorter and simpler, but it covers only some types of payments.
- Does the form include all required information? If required information is missing, additional due diligence is required to determine whether to treat the individual as U.S. or foreign.
- If a treaty rate of withholding is claimed, is it valid? Due diligence is required to verify that zero or reduced withholding is actually offered by the applicable treaty and there are no red flags of a non-valid claim.
- Is the validity review up to your organization, or does the IRS also need to review? Each form has different rules.
Learning objectives for this program:
- Determine which form – the 8233 or W-8BEN – must be obtained from your foreign individual payees
- Identify the required elements of a valid Form W-8BEN and Form 8233
- Locate IRS information for validity checks of tax treaty benefit claims
Marianne Couch, JD - Principal, Cokala Tax Information Reporting Solutions, LLC
Marianne Couch, JD, a Principal in the Cokala tax group since its founding early in 2007, is an experienced and well-known advisor on U.S. federal and state tax information reporting compliance. She is a frequent lecturer at major tax conferences and the author of The Master Guide to Form 1099 Compliance and numerous published articles. She is a founding partner of Cokala. Previously, she was for many years the Research Director of the tax reporting specialty firm Balance Consulting, and chaired special training and advisory services provided to large organizations and academic and nonprofit institutions. She also formerly served as the executive director of the National Association of Form 1099 Filers, Inc.
Marianne was an appointee for three years to the IRS Information Reporting Program Advisory Committee (IRPAC), where she was Chair of the IRPAC Subcommittee on Small Business and Self-Employed (SBSE) tax issues.
Marianne formerly served as a Research Attorney for the Michigan Court of Appeals, and earlier as a litigator for a large Michigan law firm, where she represented individuals and large clients in many types of civil actions. She received her JD, cum laude, from the Michigan State University School of Law, and is a member of the State Bar of Michigan.
Continuing education credits available!
Receive 2 CEUs toward AP & P2P/IOFM APM, APS, or APD recertification! The Accounts Payable Certification Program is designed to establish standards for the profession and recognize accounts payable professionals who, by possessing related work experience and passing a comprehensive exam, have met stringent requirements for mastering the accounts payable body of knowledge.
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