W-9 Form and W-8 Form for Foreign Entities Doing Business in the U.S.
Foreign entities doing business in the United States must fill out a W-9 form if receiving income from a US company. The IRS requires a W-8 form from each foreign individual or business. Independent contractors working with companies they are not employed by often must provide that company a W-9.
W-8 Forms for Foreign Individuals and Entities
A W-8 form is used by foreign individuals and entities doing business in the United States to document status for tax reporting purposes. 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.
Tax Reporting for Foreign Entities
Foreign individuals and companies not residing in the U.S. don’t file a W-9. Foreign aliens who are U.S. residents must file a W-9. The motivation behind filing the W-8BEN-E is to document status for tax reporting purposes. Taxes withheld from payments to foreign entities are sent to the IRS in the beneficial owner’s name. The 1042-S form taxes gross amounts paid to and taxes withheld from foreign entities subject to income reporting.