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Form 1040x Turbotax

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Form 1040x Turbotax

Form 1040x turbotax Publication 515 - Main Content Table of Contents Withholding of TaxWithholding Agent Withholding and Reporting Obligations Persons Subject to NRA WithholdingIdentifying the Payee Foreign Persons DocumentationBeneficial Owners Foreign Intermediaries and Foreign Flow-Through Entities Standards of Knowledge Presumption Rules Income Subject to NRA WithholdingSource of Income Fixed or Determinable Annual or Periodical Income (FDAP) Withholding on Specific IncomeEffectively Connected Income Income Not Effectively Connected Pay for Personal Services Performed Artists and Athletes (Income Codes 42 and 43) Other Income Foreign Governments and Certain Other Foreign Organizations U. Form 1040x turbotax S. Form 1040x turbotax Taxpayer Identification NumbersUnexpected payment. Form 1040x turbotax Depositing Withheld TaxesWhen Deposits Are Required Adjustment for Overwithholding Returns RequiredJoint owners. Form 1040x turbotax Electronic reporting. Form 1040x turbotax Partnership Withholding on Effectively Connected IncomeWho Must Withhold Foreign Partner Publicly Traded Partnerships U. Form 1040x turbotax S. Form 1040x turbotax Real Property InterestForeign corporations. Form 1040x turbotax Domestic corporations. Form 1040x turbotax U. Form 1040x turbotax S. Form 1040x turbotax real property holding corporations. Form 1040x turbotax Partnerships. Form 1040x turbotax Trusts and estates. Form 1040x turbotax Domestically controlled QIE. Form 1040x turbotax Late filing of certifications or notices. Form 1040x turbotax Certifications. Form 1040x turbotax Liability of agent or qualified substitute. Form 1040x turbotax Reporting and Paying the Tax Withholding Certificates Tax Treaty TablesTable 1 Table 2 Table 3 How To Get Tax HelpLow Income Taxpayer Clinics (LITCs). Form 1040x turbotax Withholding of Tax In most cases, a foreign person is subject to U. Form 1040x turbotax S. Form 1040x turbotax tax on its U. Form 1040x turbotax S. Form 1040x turbotax source income. Form 1040x turbotax Most types of U. Form 1040x turbotax S. Form 1040x turbotax source income received by a foreign person are subject to U. Form 1040x turbotax S. Form 1040x turbotax tax of 30%. Form 1040x turbotax A reduced rate, including exemption, may apply if there is a tax treaty between the foreign person's country of residence and the United States. Form 1040x turbotax The tax is generally withheld (NRA withholding) from the payment made to the foreign person. Form 1040x turbotax The term “NRA withholding” is used in this publication descriptively to refer to withholding required under sections 1441, 1442, and 1443 of the Internal Revenue Code. Form 1040x turbotax In most cases, NRA withholding describes the withholding regime that requires withholding on a payment of U. Form 1040x turbotax S. Form 1040x turbotax source income. Form 1040x turbotax Payments to foreign persons, including nonresident alien individuals, foreign entities, and governments, may be subject to NRA withholding. Form 1040x turbotax NRA withholding does not include withholding under section 1445 of the Code (see U. Form 1040x turbotax S. Form 1040x turbotax Real Property Interest, later) or under section 1446 of the Code (see Partnership Withholding on Effectively Connected Income , later). Form 1040x turbotax A withholding agent (defined next) is the person responsible for withholding on payments made to a foreign person. Form 1040x turbotax However, a withholding agent that can reliably associate the payment with documentation (discussed later) from a U. Form 1040x turbotax S. Form 1040x turbotax person is not required to withhold. Form 1040x turbotax In addition, a withholding agent may apply a reduced rate of withholding (including an exemption from withholding) if it can reliably associate the payment with documentation from a beneficial owner that is a foreign person entitled to a reduced rate of withholding. Form 1040x turbotax Withholding Agent You are a withholding agent if you are a U. Form 1040x turbotax S. Form 1040x turbotax or foreign person that has control, receipt, custody, disposal, or payment of any item of income of a foreign person that is subject to withholding. Form 1040x turbotax A withholding agent may be an individual, corporation, partnership, trust, association, nominee (under section 1446 of the Code), or any other entity, including any foreign intermediary, foreign partnership, or U. Form 1040x turbotax S. Form 1040x turbotax branch of certain foreign banks and insurance companies. Form 1040x turbotax You may be a withholding agent even if there is no requirement to withhold from a payment or even if another person has withheld the required amount from the payment. Form 1040x turbotax Although several persons may be withholding agents for a single payment, the full tax is required to be withheld only once. Form 1040x turbotax In most cases, the U. Form 1040x turbotax S. Form 1040x turbotax person who pays an amount subject to NRA withholding is the person responsible for withholding. Form 1040x turbotax However, other persons may be required to withhold. Form 1040x turbotax For example, a payment made by a flow-through entity or nonqualified intermediary that knows, or has reason to know, that the full amount of NRA withholding was not done by the person from which it receives a payment is required to do the appropriate withholding since it also falls within the definition of a withholding agent. Form 1040x turbotax In addition, withholding must be done by any qualified intermediary, withholding foreign partnership, or withholding foreign trust in accordance with the terms of its withholding agreement, discussed later. Form 1040x turbotax Liability for tax. Form 1040x turbotax   As a withholding agent, you are personally liable for any tax required to be withheld. Form 1040x turbotax This liability is independent of the tax liability of the foreign person to whom the payment is made. Form 1040x turbotax If you fail to withhold and the foreign payee fails to satisfy its U. Form 1040x turbotax S. Form 1040x turbotax tax liability, then both you and the foreign person are liable for tax, as well as interest and any applicable penalties. Form 1040x turbotax   The applicable tax will be collected only once. Form 1040x turbotax If the foreign person satisfies its U. Form 1040x turbotax S. Form 1040x turbotax tax liability, you are not liable for the tax but remain liable for any interest and penalties for failure to withhold. Form 1040x turbotax Determination of amount to withhold. Form 1040x turbotax   You must withhold on the gross amount subject to NRA withholding. Form 1040x turbotax You cannot reduce the gross amount by any deductions. Form 1040x turbotax However, see Scholarships and Fellowship Grants and Pay for Personal Services Performed , later, for when a deduction for a personal exemption may be allowed. Form 1040x turbotax   If the determination of the source of the income or the amount subject to tax depends on facts that are not known at the time of payment, you must withhold an amount sufficient to ensure that at least 30% of the amount subsequently determined to be subject to withholding is withheld. Form 1040x turbotax In no case, however, should you withhold more than 30% of the total amount paid. Form 1040x turbotax Or, you may make a reasonable estimate of the amount from U. Form 1040x turbotax S. Form 1040x turbotax sources and put a corresponding part of the amount due in escrow until the amount from U. Form 1040x turbotax S. Form 1040x turbotax sources can be determined, at which time withholding becomes due. Form 1040x turbotax When to withhold. Form 1040x turbotax   Withholding is required at the time you make a payment of an amount subject to withholding. Form 1040x turbotax A payment is made to a person if that person realizes income, whether or not there is an actual transfer of cash or other property. Form 1040x turbotax A payment is considered made to a person if it is paid for that person's benefit. Form 1040x turbotax For example, a payment made to a creditor of a person in satisfaction of that person's debt to the creditor is considered made to the person. Form 1040x turbotax A payment also is considered made to a person if it is made to that person's agent. Form 1040x turbotax   A U. Form 1040x turbotax S. Form 1040x turbotax partnership should withhold when any distributions that include amounts subject to withholding are made. Form 1040x turbotax However, if a foreign partner's distributive share of income subject to withholding is not actually distributed, the U. Form 1040x turbotax S. Form 1040x turbotax partnership must withhold on the foreign partner's distributive share of the income on the earlier of the date that a Schedule K-1 (Form 1065) is provided or mailed to the partner or the due date for furnishing that schedule. Form 1040x turbotax If the distributable amount consists of effectively connected income, see Partnership Withholding on Effectively Connected Income , later. Form 1040x turbotax A U. Form 1040x turbotax S. Form 1040x turbotax trust is required to withhold on the amount includible in the gross income of a foreign beneficiary to the extent the trust's distributable net income consists of an amount subject to withholding. Form 1040x turbotax To the extent a U. Form 1040x turbotax S. Form 1040x turbotax trust is required to distribute an amount subject to withholding but does not actually distribute the amount, it must withhold on the foreign beneficiary's allocable share at the time the income is required to be reported on Form 1042-S. Form 1040x turbotax Withholding and Reporting Obligations You are required to report payments subject to NRA withholding on Form 1042-S and to file a tax return on Form 1042. Form 1040x turbotax (See Returns Required , later. Form 1040x turbotax ) An exception from reporting may apply to individuals who are not required to withhold from a payment and who do not make the payment in the course of their trade or business. Form 1040x turbotax Form 1099 reporting and backup withholding. Form 1040x turbotax    You also may be responsible as a payer for reporting on Form 1099 payments made to a U. Form 1040x turbotax S. Form 1040x turbotax person. Form 1040x turbotax You must withhold 28% (backup withholding rate) from a reportable payment made to a U. Form 1040x turbotax S. Form 1040x turbotax person that is subject to Form 1099 reporting if any of the following apply. Form 1040x turbotax The U. Form 1040x turbotax S. Form 1040x turbotax person has not provided its taxpayer identification number (TIN) in the manner required. Form 1040x turbotax The IRS notifies you that the TIN furnished by the payee is incorrect. Form 1040x turbotax There has been a notified payee underreporting. Form 1040x turbotax There has been a payee certification failure. Form 1040x turbotax In most cases, a TIN must be provided by a U. Form 1040x turbotax S. Form 1040x turbotax non-exempt recipient on Form W-9, Request for Taxpayer Identification Number and Certification. Form 1040x turbotax A payer files a tax return on Form 945, Annual Return of Withheld Federal Income Tax, for backup withholding. Form 1040x turbotax You may be required to file Form 1099 and, if appropriate, backup withhold, even if you do not make the payments directly to that U. Form 1040x turbotax S. Form 1040x turbotax person. Form 1040x turbotax For example, you are required to report income paid to a foreign intermediary or flow-through entity that collects for a U. Form 1040x turbotax S. Form 1040x turbotax person subject to Form 1099 reporting. Form 1040x turbotax See Identifying the Payee , later, for more information. Form 1040x turbotax Also see Section S. Form 1040x turbotax Special Rules for Reporting Payments Made Through Foreign Intermediaries and Foreign Flow-Through Entities on Form 1099 in the General Instructions for Certain Information Returns. Form 1040x turbotax Foreign persons who provide Form W-8BEN, Form W-8ECI, or Form W-8EXP (or applicable documentary evidence) are exempt from backup withholding and Form 1099 reporting. Form 1040x turbotax Wages paid to employees. Form 1040x turbotax   If you are the employer of a nonresident alien, you generally must withhold taxes at graduated rates. Form 1040x turbotax See Pay for Personal Services Performed , later. Form 1040x turbotax Effectively connected income by partnerships. Form 1040x turbotax   A withholding agent that is a partnership (whether U. Form 1040x turbotax S. Form 1040x turbotax or foreign) is also responsible for withholding on its income effectively connected with a U. Form 1040x turbotax S. Form 1040x turbotax trade or business that is allocable to foreign partners. Form 1040x turbotax See Partnership Withholding on Effectively Connected Income , later, for more information. Form 1040x turbotax U. Form 1040x turbotax S. Form 1040x turbotax real property interest. Form 1040x turbotax   A withholding agent also may be responsible for withholding if a foreign person transfers a U. Form 1040x turbotax S. Form 1040x turbotax real property interest to the agent, or if it is a corporation, partnership, trust, or estate that distributes a U. Form 1040x turbotax S. Form 1040x turbotax real property interest to a shareholder, partner, or beneficiary that is a foreign person. Form 1040x turbotax See U. Form 1040x turbotax S. Form 1040x turbotax Real Property Interest , later. Form 1040x turbotax Persons Subject to NRA Withholding NRA withholding applies only to payments made to a payee that is a foreign person. Form 1040x turbotax It does not apply to payments made to U. Form 1040x turbotax S. Form 1040x turbotax persons. Form 1040x turbotax Usually, you determine the payee's status as a U. Form 1040x turbotax S. Form 1040x turbotax or foreign person based on the documentation that person provides. Form 1040x turbotax See Documentation , later. Form 1040x turbotax However, if you have received no documentation or you cannot reliably associate all or a part of a payment with documentation, then you must apply certain presumption rules, discussed later. Form 1040x turbotax Identifying the Payee In most cases, the payee is the person to whom you make the payment, regardless of whether that person is the beneficial owner of the income. Form 1040x turbotax However, there are situations in which the payee is a person other than the one to whom you actually make a payment. Form 1040x turbotax U. Form 1040x turbotax S. Form 1040x turbotax agent of foreign person. Form 1040x turbotax   If you make a payment to a U. Form 1040x turbotax S. Form 1040x turbotax person and you have actual knowledge that the U. Form 1040x turbotax S. Form 1040x turbotax person is receiving the payment as an agent of a foreign person, you must treat the payment as made to the foreign person. Form 1040x turbotax However, if the U. Form 1040x turbotax S. Form 1040x turbotax person is a financial institution, you may treat the institution as the payee provided you have no reason to believe that the institution will not comply with its own obligation to withhold. Form 1040x turbotax   If the payment is not subject to NRA withholding (for example, gross proceeds from the sales of securities), you must treat the payment as made to a U. Form 1040x turbotax S. Form 1040x turbotax person and not as a payment to a foreign person. Form 1040x turbotax You may be required to report the payment on Form 1099 and, if applicable, backup withhold. Form 1040x turbotax Disregarded entities. Form 1040x turbotax   A business entity that is not a corporation and that has a single owner may be disregarded as an entity separate from its owner (a disregarded entity) for federal tax purposes. Form 1040x turbotax The payee of a payment made to a disregarded entity is the owner of the entity. Form 1040x turbotax   If the owner of the entity is a foreign person, you must apply NRA withholding unless you can treat the foreign owner as a beneficial owner entitled to a reduced rate of withholding. Form 1040x turbotax   If the owner is a U. Form 1040x turbotax S. Form 1040x turbotax person, you do not apply NRA withholding. Form 1040x turbotax However, you may be required to report the payment on Form 1099 and, if applicable, backup withhold. Form 1040x turbotax You may assume that a foreign entity is not a disregarded entity unless you can reliably associate the payment with documentation provided by the owner or you have actual knowledge or reason to know that the foreign entity is a disregarded entity. Form 1040x turbotax Flow-Through Entities The payees of payments (other than income effectively connected with a U. Form 1040x turbotax S. Form 1040x turbotax trade or business) made to a foreign flow-through entity are the owners or beneficiaries of the flow-through entity. Form 1040x turbotax This rule applies for purposes of NRA withholding and for Form 1099 reporting and backup withholding. Form 1040x turbotax Income that is, or is deemed to be, effectively connected with the conduct of a U. Form 1040x turbotax S. Form 1040x turbotax trade or business of a flow-through entity is treated as paid to the entity. Form 1040x turbotax All of the following are flow-through entities. Form 1040x turbotax A foreign partnership (other than a withholding foreign partnership). Form 1040x turbotax A foreign simple or foreign grantor trust (other than a withholding foreign trust). Form 1040x turbotax A fiscally transparent entity receiving income for which treaty benefits are claimed. Form 1040x turbotax See Fiscally transparent entity , later. Form 1040x turbotax In most cases, you treat a payee as a flow-through entity if it provides you with a Form W-8IMY (see Documentation , later) on which it claims such status. Form 1040x turbotax You also may be required to treat the entity as a flow-through entity under the presumption rules, discussed later. Form 1040x turbotax You must determine whether the owners or beneficiaries of a flow-through entity are U. Form 1040x turbotax S. Form 1040x turbotax or foreign persons, how much of the payment relates to each owner or beneficiary, and, if the owner or beneficiary is foreign, whether a reduced rate of NRA withholding applies. Form 1040x turbotax You make these determinations based on the documentation and other information (contained in a withholding statement) that is associated with the flow-through entity's Form W-8IMY. Form 1040x turbotax If you do not have all of the information that is required to reliably associate a payment with a specific payee, you must apply the presumption rules. Form 1040x turbotax See Documentation and Presumption Rules , later. Form 1040x turbotax Withholding foreign partnerships and withholding foreign trusts are not flow-through entities. Form 1040x turbotax Foreign partnerships. Form 1040x turbotax    A foreign partnership is any partnership that is not organized under the laws of any state of the United States or the District of Columbia or any partnership that is treated as foreign under the income tax regulations. Form 1040x turbotax If a foreign partnership is not a withholding foreign partnership, the payees of income are the partners of the partnership, provided the partners are not themselves a flow-through entity or a foreign intermediary. Form 1040x turbotax However, the payee is the partnership itself if the partnership is claiming treaty benefits on the basis that it is not fiscally transparent and that it meets all the other requirements for claiming treaty benefits. Form 1040x turbotax If a partner is a foreign flow-through entity or a foreign intermediary, you apply the payee determination rules to that partner to determine the payees. Form 1040x turbotax Example 1. Form 1040x turbotax A nonwithholding foreign partnership has three partners: a nonresident alien individual; a foreign corporation; and a U. Form 1040x turbotax S. Form 1040x turbotax citizen. Form 1040x turbotax You make a payment of U. Form 1040x turbotax S. Form 1040x turbotax source interest to the partnership. Form 1040x turbotax It gives you a Form W-8IMY with which it associates Form W-8BEN from the nonresident alien; Form W-8BEN from the foreign corporation; and Form W-9 from the U. Form 1040x turbotax S. Form 1040x turbotax citizen. Form 1040x turbotax The partnership also gives you a complete withholding statement that enables you to associate a part of the interest payment to each partner. Form 1040x turbotax You must treat all three partners as the payees of the interest payment as if the payment were made directly to them. Form 1040x turbotax Report the payment to the nonresident alien and the foreign corporation on Forms 1042-S. Form 1040x turbotax Report the payment to the U. Form 1040x turbotax S. Form 1040x turbotax citizen on Form 1099-INT. Form 1040x turbotax Example 2. Form 1040x turbotax A nonwithholding foreign partnership has two partners: a foreign corporation and a nonwithholding foreign partnership. Form 1040x turbotax The second partnership has two partners, both nonresident alien individuals. Form 1040x turbotax You make a payment of U. Form 1040x turbotax S. Form 1040x turbotax source interest to the first partnership. Form 1040x turbotax It gives you a valid Form W-8IMY with which it associates a Form W-8BEN from the foreign corporation and a Form W-8IMY from the second partnership. Form 1040x turbotax In addition, Forms W-8BEN from the partners are associated with the Form W-8IMY from the second partnership. Form 1040x turbotax The Forms W-8IMY from the partnerships have complete withholding statements associated with them. Form 1040x turbotax Because you can reliably associate a part of the interest payment with the Form W-8BEN provided by the foreign corporation and the Forms W-8BEN provided by the nonresident alien individual partners as a result of the withholding statements, you must treat them as the payees of the interest. Form 1040x turbotax Example 3. Form 1040x turbotax You make a payment of U. Form 1040x turbotax S. Form 1040x turbotax source dividends to a withholding foreign partnership. Form 1040x turbotax The partnership has two partners, both foreign corporations. Form 1040x turbotax You can reliably associate the payment with a valid Form W-8IMY from the partnership on which it represents that it is a withholding foreign partnership. Form 1040x turbotax You must treat the partnership as the payee of the dividends. Form 1040x turbotax Foreign simple and grantor trust. Form 1040x turbotax   A trust is foreign unless it meets both of the following tests. Form 1040x turbotax A court within the United States is able to exercise primary supervision over the administration of the trust. Form 1040x turbotax One or more U. Form 1040x turbotax S. Form 1040x turbotax persons have the authority to control all substantial decisions of the trust. Form 1040x turbotax   In most cases, a foreign simple trust is a foreign trust that is required to distribute all of its income annually. Form 1040x turbotax A foreign grantor trust is a foreign trust that is treated as a grantor trust under sections 671 through 679 of the Code. Form 1040x turbotax   The payees of a payment made to a foreign simple trust are the beneficiaries of the trust. Form 1040x turbotax The payees of a payment made to a foreign grantor trust are the owners of the trust. Form 1040x turbotax However, the payee is the foreign simple or grantor trust itself if the trust is claiming treaty benefits on the basis that it is not fiscally transparent and that it meets all the other requirements for claiming treaty benefits. Form 1040x turbotax If the beneficiaries or owners are themselves flow-through entities or foreign intermediaries, you apply the payee determination rules to that beneficiary or owner to determine the payees. Form 1040x turbotax Example. Form 1040x turbotax A foreign simple trust has three beneficiaries: two nonresident alien individuals and a U. Form 1040x turbotax S. Form 1040x turbotax citizen. Form 1040x turbotax You make a payment of interest to the foreign trust. Form 1040x turbotax It gives you a Form W-8IMY with which it associates Forms W-8BEN from the nonresident aliens and a Form W-9 from the U. Form 1040x turbotax S. Form 1040x turbotax citizen. Form 1040x turbotax The trust also gives you a complete withholding statement that enables you to associate a part of the interest payment with the forms provided by each beneficiary. Form 1040x turbotax You must treat all three beneficiaries as the payees of the interest payment as if the payment were made directly to them. Form 1040x turbotax Report the payment to the nonresident aliens on Forms 1042-S. Form 1040x turbotax Report the payment to the U. Form 1040x turbotax S. Form 1040x turbotax citizen on Form 1099-INT. Form 1040x turbotax Fiscally transparent entity. Form 1040x turbotax   If a reduced rate of withholding under an income tax treaty is claimed, a flow-through entity includes any entity in which the interest holder must treat the entity as fiscally transparent. Form 1040x turbotax The determination of whether an entity is fiscally transparent is made on an item of income basis (that is, the determination is made separately for interest, dividends, royalties, etc. Form 1040x turbotax ). Form 1040x turbotax The interest holder in an entity makes the determination by applying the laws of the jurisdiction where the interest holder is organized, incorporated, or otherwise considered a resident. Form 1040x turbotax An entity is considered to be fiscally transparent for the income to the extent the laws of that jurisdiction require the interest holder to separately take into account on a current basis the interest holder's share of the income, whether or not distributed to the interest holder, and the character and source of the income to the interest holder are determined as if the income was realized directly from the source that paid it to the entity. Form 1040x turbotax Subject to the standards of knowledge rules discussed later, you generally make the determination that an entity is fiscally transparent based on a Form W-8IMY provided by the entity. Form 1040x turbotax   The payees of a payment made to a fiscally transparent entity are the interest holders of the entity. Form 1040x turbotax Example. Form 1040x turbotax Entity A is a business organization organized under the laws of country X that has an income tax treaty in force with the United States. Form 1040x turbotax A has two interest holders, B and C. Form 1040x turbotax B is a corporation organized under the laws of country Y. Form 1040x turbotax C is a corporation organized under the laws of country Z. Form 1040x turbotax Both countries Y and Z have an income tax treaty in force with the United States. Form 1040x turbotax A receives royalty income from U. Form 1040x turbotax S. Form 1040x turbotax sources that is not effectively connected with the conduct of a trade or business in the United States. Form 1040x turbotax For U. Form 1040x turbotax S. Form 1040x turbotax income tax purposes, A is treated as a partnership. Form 1040x turbotax Country X treats A as a partnership and requires the interest holders in A to separately take into account on a current basis their respective shares of the income paid to A even if the income is not distributed. Form 1040x turbotax The laws of country X provide that the character and source of the income to A's interest holders are determined as if the income was realized directly from the source that paid it to A. Form 1040x turbotax Accordingly, A is fiscally transparent in its jurisdiction, country X. Form 1040x turbotax B and C are not fiscally transparent under the laws of their respective countries of incorporation. Form 1040x turbotax Country Y requires B to separately take into account on a current basis B's share of the income paid to A, and the character and source of the income to B is determined as if the income was realized directly from the source that paid it to A. Form 1040x turbotax Accordingly, A is fiscally transparent for that income under the laws of country Y, and B is treated as deriving its share of the U. Form 1040x turbotax S. Form 1040x turbotax source royalty income for purposes of the U. Form 1040x turbotax S. Form 1040x turbotax -Y income tax treaty. Form 1040x turbotax Country Z, on the other hand, treats A as a corporation and does not require C to take into account its share of A's income on a current basis whether or not distributed. Form 1040x turbotax Therefore, A is not treated as fiscally transparent under the laws of country Z. Form 1040x turbotax Accordingly, C is not treated as deriving its share of the U. Form 1040x turbotax S. Form 1040x turbotax source royalty income for purposes of the U. Form 1040x turbotax S. Form 1040x turbotax -Z income tax treaty. Form 1040x turbotax Foreign Intermediaries In most cases, if you make payments to a foreign intermediary, the payees are the persons for whom the foreign intermediary collects the payment, such as account holders or customers, not the intermediary itself. Form 1040x turbotax This rule applies for purposes of NRA withholding and for Form 1099 reporting and backup withholding. Form 1040x turbotax You may, however, treat a qualified intermediary that has assumed primary withholding responsibility for a payment as the payee, and you are not required to withhold. Form 1040x turbotax An intermediary is a custodian, broker, nominee, or any other person that acts as an agent for another person. Form 1040x turbotax A foreign intermediary is either a qualified intermediary or a nonqualified intermediary. Form 1040x turbotax In most cases, you determine whether an entity is a qualified intermediary or a nonqualified intermediary based on the representations the intermediary makes on Form W-8IMY. Form 1040x turbotax You must determine whether the customers or account holders of a foreign intermediary are U. Form 1040x turbotax S. Form 1040x turbotax or foreign persons and, if the account holder or customer is foreign, whether a reduced rate of NRA withholding applies. Form 1040x turbotax You make these determinations based on the foreign intermediary's Form W-8IMY and associated information and documentation. Form 1040x turbotax If you do not have all of the information or documentation that is required to reliably associate a payment with a payee, you must apply the presumption rules. Form 1040x turbotax See Documentation and Presumption Rules , later. Form 1040x turbotax Nonqualified intermediary. Form 1040x turbotax   A nonqualified intermediary (NQI) is any intermediary that is a foreign person and that is not a qualified intermediary. Form 1040x turbotax The payees of a payment made to an NQI are the customers or account holders on whose behalf the NQI is acting. Form 1040x turbotax Example. Form 1040x turbotax You make a payment of interest to a foreign bank that is a nonqualified intermediary. Form 1040x turbotax The bank gives you a Form W-8IMY and the Forms W-8BEN of two foreign persons, and a Form W-9 from a U. Form 1040x turbotax S. Form 1040x turbotax person for whom the bank is collecting the payments. Form 1040x turbotax The bank also associates with its Form W-8IMY a withholding statement on which it allocates the interest payment to each account holder and provides all other information required to be on the withholding statement. Form 1040x turbotax The account holders are the payees of the interest payment. Form 1040x turbotax You should report the part of the interest paid to the two foreign persons on Forms 1042-S and the part paid to the U. Form 1040x turbotax S. Form 1040x turbotax person on Form 1099-INT. Form 1040x turbotax Qualified intermediary. Form 1040x turbotax   A qualified intermediary (QI) is any foreign intermediary (or foreign branch of a U. Form 1040x turbotax S. Form 1040x turbotax intermediary) that has entered into a qualified intermediary withholding agreement (discussed later) with the IRS. Form 1040x turbotax You may treat a QI as a payee to the extent the QI assumes primary withholding responsibility or primary Form 1099 reporting and backup withholding responsibility for a payment. Form 1040x turbotax In this situation, the QI is required to withhold the tax. Form 1040x turbotax You can determine whether a QI has assumed responsibility from the Form W-8IMY provided by the QI. Form 1040x turbotax   A payment to a QI to the extent it does not assume primary NRA withholding responsibility is considered made to the person on whose behalf the QI acts. Form 1040x turbotax If a QI does not assume Form 1099 reporting and backup withholding responsibility, you must report on Form 1099 and, if applicable, backup withhold as if you were making the payment directly to the U. Form 1040x turbotax S. Form 1040x turbotax person. Form 1040x turbotax Branches of financial institutions. Form 1040x turbotax   Branches of financial institutions are not permitted to operate as QIs if they are located outside of countries having approved “know-your-customer” (KYC) rules. Form 1040x turbotax The countries with approved KYC rules are listed on IRS. Form 1040x turbotax gov. Form 1040x turbotax QI withholding agreement. Form 1040x turbotax   Foreign financial institutions and foreign branches of U. Form 1040x turbotax S. Form 1040x turbotax financial institutions can enter into an agreement with the IRS to be a qualified intermediary. Form 1040x turbotax   A QI is entitled to certain simplified withholding and reporting rules. Form 1040x turbotax In general, there are three major areas whereby intermediaries with QI status are afforded such simplified treatment. Form 1040x turbotax   To apply for QI status, complete Form 14345, Qualified Intermediary Application, and Form SS-4, Application for Employer Identification Number. Form 1040x turbotax These forms, and the procedures required to obtain a QI withholding agreement are available at www. Form 1040x turbotax irs. Form 1040x turbotax gov/Businesses/Corporations/Qualified-Intermediaries-(QI). Form 1040x turbotax Documentation. Form 1040x turbotax   A QI is not required to forward documentation obtained from foreign account holders to the U. Form 1040x turbotax S. Form 1040x turbotax withholding agent from whom the QI receives a payment of U. Form 1040x turbotax S. Form 1040x turbotax source income. Form 1040x turbotax The QI maintains such documentation at its location and provides the U. Form 1040x turbotax S. Form 1040x turbotax withholding agent with withholding rate pools. Form 1040x turbotax A withholding rate pool is a payment of a single type of income that is subject to a single rate of withholding. Form 1040x turbotax   A QI is required to provide the U. Form 1040x turbotax S. Form 1040x turbotax withholding agent with information regarding U. Form 1040x turbotax S. Form 1040x turbotax persons subject to Form 1099 information reporting unless the QI assumes the primary obligation to do Form 1099 reporting and backup withholding. Form 1040x turbotax   If a QI obtains documentary evidence under the “know-your-customer” rules that apply to the QI under local law, and the documentary evidence is of a type specified in an attachment to the QI agreement, the documentary evidence remains valid until there is a change in circumstances or the QI knows the information is incorrect. Form 1040x turbotax This indefinite validity period rule does not apply to Forms W-8 or to documentary evidence that is not of the type specified in the attachment to the agreement. Form 1040x turbotax Form 1042-S reporting. Form 1040x turbotax   A QI is permitted to report payments made to its direct foreign account holders on a pooled basis rather than reporting payments to each direct account holder specifically. Form 1040x turbotax Pooled basis reporting is not available for payments to certain account holders, such as a nonqualified intermediary or a flow-through entity (discussed earlier). Form 1040x turbotax Collective refund procedures. Form 1040x turbotax   A QI may seek a refund on behalf of its direct account holders. Form 1040x turbotax The direct account holders, therefore, are not required to file returns with the IRS to obtain refunds, but rather may obtain them from the QI. Form 1040x turbotax U. Form 1040x turbotax S. Form 1040x turbotax branches of foreign banks and foreign insurance companies. Form 1040x turbotax   Special rules apply to a U. Form 1040x turbotax S. Form 1040x turbotax branch of a foreign bank subject to Federal Reserve Board supervision or a foreign insurance company subject to state regulatory supervision. Form 1040x turbotax If you agree to treat the branch as a U. Form 1040x turbotax S. Form 1040x turbotax person, you may treat the branch as a U. Form 1040x turbotax S. Form 1040x turbotax payee for a payment subject to NRA withholding provided you receive a Form W-8IMY from the U. Form 1040x turbotax S. Form 1040x turbotax branch on which the agreement is evidenced. Form 1040x turbotax If you treat the branch as a U. Form 1040x turbotax S. Form 1040x turbotax payee, you are not required to withhold. Form 1040x turbotax Even though you agree to treat the branch as a U. Form 1040x turbotax S. Form 1040x turbotax person, you must report the payment on Form 1042-S. Form 1040x turbotax   A financial institution organized in a U. Form 1040x turbotax S. Form 1040x turbotax possession is treated as a U. Form 1040x turbotax S. Form 1040x turbotax branch. Form 1040x turbotax The special rules discussed in this section apply to a possessions financial institution. Form 1040x turbotax   If you are paying a U. Form 1040x turbotax S. Form 1040x turbotax branch an amount that is not subject to NRA withholding, treat the payment as made to a foreign person, irrespective of any agreement to treat the branch as a U. Form 1040x turbotax S. Form 1040x turbotax person for amounts subject to NRA withholding. Form 1040x turbotax Consequently, amounts not subject to NRA withholding that are paid to a U. Form 1040x turbotax S. Form 1040x turbotax branch are not subject to Form 1099 reporting or backup withholding. Form 1040x turbotax   Alternatively, a U. Form 1040x turbotax S. Form 1040x turbotax branch may provide you with a Form W-8IMY with which it associates the documentation of the persons on whose behalf it acts. Form 1040x turbotax In this situation, the payees are the persons on whose behalf the branch acts provided you can reliably associate the payment with valid documentation from those persons. Form 1040x turbotax See Nonqualified Intermediaries under  Documentation, later. Form 1040x turbotax   If the U. Form 1040x turbotax S. Form 1040x turbotax branch does not provide you with a Form W-8IMY, then you should treat a payment subject to NRA withholding as made to the foreign person of which the branch is a part and the income as effectively connected with the conduct of a trade or business in the United States. Form 1040x turbotax Withholding foreign partnership and foreign trust. Form 1040x turbotax   A withholding foreign partnership (WP) is any foreign partnership that has entered into a WP withholding agreement with the IRS and is acting in that capacity. Form 1040x turbotax A withholding foreign trust (WT) is a foreign simple or grantor trust that has entered into a WT withholding agreement with the IRS and is acting in that capacity. Form 1040x turbotax   A WP or WT may act in that capacity only for payments of amounts subject to NRA withholding that are distributed to, or included in the distributive share of, its direct partners, beneficiaries, or owners. Form 1040x turbotax A WP or WT acting in that capacity must assume NRA withholding responsibility for these amounts. Form 1040x turbotax You may treat a WP or WT as a payee if it has provided you with documentation (discussed later) that represents that it is acting as a WP or WT for such amounts. Form 1040x turbotax WP and WT withholding agreements. Form 1040x turbotax   The WP and WT withholding agreements and the application procedures for the agreements are in Revenue Procedure 2003-64. Form 1040x turbotax Also see the following items. Form 1040x turbotax Revenue Procedure 2004-21. Form 1040x turbotax Revenue Procedure 2005-77. Form 1040x turbotax Employer identification number (EIN). Form 1040x turbotax   A completed Form SS-4 must be submitted with the application for being a WP or WT. Form 1040x turbotax The WP or WT will be assigned a WP-EIN or WT-EIN to be used only when acting in that capacity. Form 1040x turbotax Documentation. Form 1040x turbotax   A WP or WT must provide you with a Form W-8IMY that certifies that the WP or WT is acting in that capacity and a written statement identifying the amounts for which it is so acting. Form 1040x turbotax The statement is not required to contain withholding rate pool information or any information relating to the identity of a direct partner, beneficiary, or owner. Form 1040x turbotax The Form W-8IMY must contain the WP-EIN or WT-EIN. Form 1040x turbotax Foreign Persons A payee is subject to NRA withholding only if it is a foreign person. Form 1040x turbotax A foreign person includes a nonresident alien individual, foreign corporation, foreign partnership, foreign trust, foreign estate, and any other person that is not a U. Form 1040x turbotax S. Form 1040x turbotax person. Form 1040x turbotax It also includes a foreign branch of a U. Form 1040x turbotax S. Form 1040x turbotax financial institution if the foreign branch is a qualified intermediary. Form 1040x turbotax In most cases, the U. Form 1040x turbotax S. Form 1040x turbotax branch of a foreign corporation or partnership is treated as a foreign person. Form 1040x turbotax Nonresident alien. Form 1040x turbotax   A nonresident alien is an individual who is not a U. Form 1040x turbotax S. Form 1040x turbotax citizen or a resident alien. Form 1040x turbotax A resident of a foreign country under the residence article of an income tax treaty is a nonresident alien individual for purposes of withholding. Form 1040x turbotax Married to U. Form 1040x turbotax S. Form 1040x turbotax citizen or resident alien. Form 1040x turbotax   Nonresident alien individuals married to U. Form 1040x turbotax S. Form 1040x turbotax citizens or resident aliens may choose to be treated as resident aliens for certain income tax purposes. Form 1040x turbotax However, these individuals are still subject to the NRA withholding rules that apply to nonresident aliens for all income except wages. Form 1040x turbotax Wages paid to these individuals are subject to graduated withholding. Form 1040x turbotax See Wages Paid to Employees—Graduated Withholding . Form 1040x turbotax Resident alien. Form 1040x turbotax   A resident alien is an individual who is not a citizen or national of the United States and who meets either the green card test or the substantial presence test for the calendar year. Form 1040x turbotax Green card test. Form 1040x turbotax An alien is a resident alien if the individual was a lawful permanent resident of the United States at any time during the calendar year. Form 1040x turbotax This is known as the green card test because these aliens hold immigrant visas (also known as green cards). Form 1040x turbotax Substantial presence test. Form 1040x turbotax An alien is considered a resident alien if the individual meets the substantial presence test for the calendar year. Form 1040x turbotax Under this test, the individual must be physically present in the United States on at least: 31 days during the current calendar year, and 183 days during the current year and the 2 preceding years, counting all the days of physical presence in the current year, but only 1/3 the number of days of presence in the first preceding year, and only 1/6 the number of days in the second preceding year. Form 1040x turbotax   In most cases, the days the alien is in the United States as a teacher, student, or trainee on an “F,” “J,” “M,” or “Q” visa are not counted. Form 1040x turbotax This exception is for a limited period of time. Form 1040x turbotax   For more information on resident and nonresident status, the tests for residence, and the exceptions to them, see Publication 519. Form 1040x turbotax Note. Form 1040x turbotax   If your employee is late in notifying you that his or her status changed from nonresident alien to resident alien, you may have to make an adjustment to Form 941 if that employee was exempt from withholding of social security and Medicare taxes as a nonresident alien. Form 1040x turbotax For more information on making adjustments, see chapter 13 of Publication 15 (Circular E). Form 1040x turbotax Resident of a U. Form 1040x turbotax S. Form 1040x turbotax possession. Form 1040x turbotax   A bona fide resident of Puerto Rico, the U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands, Guam, the Commonwealth of the Northern Mariana Islands (CNMI), or American Samoa who is not a U. Form 1040x turbotax S. Form 1040x turbotax citizen or a U. Form 1040x turbotax S. Form 1040x turbotax national is treated as a nonresident alien for the withholding rules explained here. Form 1040x turbotax A bona fide resident of a possession is someone who: Meets the presence test, Does not have a tax home outside the possession, and Does not have a closer connection to the United States or to a foreign country than to the possession. Form 1040x turbotax   For more information, see Publication 570, Tax Guide for Individuals With Income From U. Form 1040x turbotax S. Form 1040x turbotax Possessions. Form 1040x turbotax Foreign corporations. Form 1040x turbotax   A foreign corporation is one that does not fit the definition of a domestic corporation. Form 1040x turbotax A domestic corporation is one that was created or organized in the United States or under the laws of the United States, any of its states, or the District of Columbia. Form 1040x turbotax Guam or Northern Mariana Islands corporations. Form 1040x turbotax   A corporation created or organized in, or under the laws of, Guam or the CNMI is not considered a foreign corporation for the purpose of withholding tax for the tax year if: At all times during the tax year less than 25% in value of the corporation's stock is owned, directly or indirectly, by foreign persons; and At least 20% of the corporation's gross income is derived from sources within Guam or the CNMI for the 3-year period ending with the close of the preceding tax year of the corporation (or the period the corporation has been in existence, if less). Form 1040x turbotax Note. Form 1040x turbotax   The provisions discussed below under U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands and American Samoa corporations will apply to Guam or CNMI corporations when an implementing agreement is in effect between the United States and that possession. Form 1040x turbotax U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands and American Samoa corporations. Form 1040x turbotax   A corporation created or organized in, or under the laws of, the U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands or American Samoa is not considered a foreign corporation for the purposes of withholding tax for the tax year if: At all times during the tax year less than 25% in value of the corporation's stock is owned, directly or indirectly, by foreign persons, At least 65% of the corporation's gross income is effectively connected with the conduct of a trade or business in the U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands, American Samoa, Guam, the CNMI, or the United States for the 3-year period ending with the close of the tax year of the corporation (or the period the corporation or any predecessor has been in existence, if less), and No substantial part of the income of the corporation is used, directly or indirectly, to satisfy obligations to a person who is not a bona fide resident of the U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands, American Samoa, Guam, the CNMI, or the United States. Form 1040x turbotax Foreign private foundations. Form 1040x turbotax   A private foundation that was created or organized under the laws of a foreign country is a foreign private foundation. Form 1040x turbotax Gross investment income from sources within the United States paid to a qualified foreign private foundation is subject to NRA withholding at a 4% rate (unless exempted by a treaty) rather than the ordinary statutory 30% rate. Form 1040x turbotax Other foreign organizations, associations, and charitable institutions. Form 1040x turbotax   An organization may be exempt from income tax under section 501(a) of the Internal Revenue Code even if it was formed under foreign law. Form 1040x turbotax In most cases, you do not have to withhold tax on payments of income to these foreign tax-exempt organizations unless the IRS has determined that they are foreign private foundations. Form 1040x turbotax   Payments to these organizations, however, must be reported on Form 1042-S, even though no tax is withheld. Form 1040x turbotax   You must withhold tax on the unrelated business income (as described in Publication 598, Tax on Unrelated Business Income of Exempt Organizations) of foreign tax-exempt organizations in the same way that you would withhold tax on similar income of nonexempt organizations. Form 1040x turbotax U. Form 1040x turbotax S. Form 1040x turbotax branches of foreign persons. Form 1040x turbotax   In most cases, a payment to a U. Form 1040x turbotax S. Form 1040x turbotax branch of a foreign person is a payment made to the foreign person. Form 1040x turbotax However, you may treat payments to U. Form 1040x turbotax S. Form 1040x turbotax branches of foreign banks and foreign insurance companies (discussed earlier) that are subject to U. Form 1040x turbotax S. Form 1040x turbotax regulatory supervision as payments made to a U. Form 1040x turbotax S. Form 1040x turbotax person, if you and the U. Form 1040x turbotax S. Form 1040x turbotax branch have agreed to do so, and if their agreement is evidenced by a withholding certificate, Form W-8IMY. Form 1040x turbotax For this purpose, a financial institution organized under the laws of a U. Form 1040x turbotax S. Form 1040x turbotax possession is treated as a U. Form 1040x turbotax S. Form 1040x turbotax branch. Form 1040x turbotax Documentation In most cases, you must withhold 30% from the gross amount paid to a foreign payee unless you can reliably associate the payment with valid documentation that establishes either of the following. Form 1040x turbotax The payee is a U. Form 1040x turbotax S. Form 1040x turbotax person. Form 1040x turbotax The payee is a foreign person that is the beneficial owner of the income and is entitled to a reduced rate of withholding. Form 1040x turbotax In most cases, you must get the documentation before you make the payment. Form 1040x turbotax The documentation is not valid if you know, or have reason to know, that it is unreliable or incorrect. Form 1040x turbotax See Standards of Knowledge , later. Form 1040x turbotax If you cannot reliably associate a payment with valid documentation, you must use the presumption rules discussed later. Form 1040x turbotax For example, if you do not have documentation or you cannot determine the part of a payment that is allocable to specific documentation, you must use the presumption rules. Form 1040x turbotax The specific types of documentation are discussed in this section. Form 1040x turbotax However, see Withholding on Specific Income , later, as well as the instructions to the particular forms. Form 1040x turbotax As the withholding agent, you also may want to see the Instructions for the Requester of Forms W-8BEN, W-8ECI, W-8EXP, and W-8IMY. Form 1040x turbotax Section 1446 withholding. Form 1040x turbotax   Under section 1446 of the Code, a partnership must withhold tax on its effectively connected income allocable to a foreign partner. Form 1040x turbotax In most cases, a partnership determines if a partner is a foreign partner and the partner's tax classification based on the withholding certificate provided by the partner. Form 1040x turbotax This is the same documentation that is filed for NRA withholding, but may require additional information as discussed under each of the forms in this section. Form 1040x turbotax Joint owners. Form 1040x turbotax    If you make a payment to joint owners, you need to get documentation from each owner. Form 1040x turbotax Form W-9. Form 1040x turbotax   In most cases, you can treat the payee as a U. Form 1040x turbotax S. Form 1040x turbotax person if the payee gives you a Form W-9. Form 1040x turbotax The Form W-9 can be used only by a U. Form 1040x turbotax S. Form 1040x turbotax person and must contain the payee's taxpayer identification number (TIN). Form 1040x turbotax If there is more than one owner, you may treat the total amount as paid to a U. Form 1040x turbotax S. Form 1040x turbotax person if any one of the owners gives you a Form W-9. Form 1040x turbotax See U. Form 1040x turbotax S. Form 1040x turbotax Taxpayer Identification Numbers , later. Form 1040x turbotax U. Form 1040x turbotax S. Form 1040x turbotax persons are not subject to NRA withholding, but may be subject to Form 1099 reporting and backup withholding. Form 1040x turbotax Form W-8. Form 1040x turbotax   In most cases, a foreign payee of the income should give you a form in the Form W-8 series. Form 1040x turbotax Until further notice, you can rely upon Forms W-8 that contain a P. Form 1040x turbotax O. Form 1040x turbotax box as a permanent residence address provided you do not know, or have reason to know, that the person providing the form is a U. Form 1040x turbotax S. Form 1040x turbotax person and that a street address is available. Form 1040x turbotax You may rely on Forms W-8 for which there is a U. Form 1040x turbotax S. Form 1040x turbotax mailing address provided you received the form prior to December 31, 2001. Form 1040x turbotax   If certain requirements are met, the foreign person can give you documentary evidence, rather than a Form W-8. Form 1040x turbotax You can rely on documentary evidence in lieu of a Form W-8 for a payment made in a U. Form 1040x turbotax S. Form 1040x turbotax possession. Form 1040x turbotax Other documentation. Form 1040x turbotax   Other documentation may be required to claim an exemption from, or a reduced rate of, withholding on pay for personal services. Form 1040x turbotax The nonresident alien individual may have to give you a Form W-4 or a Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual. Form 1040x turbotax These forms are discussed in Pay for Personal Services Performed under Withholding on Specific Income. Form 1040x turbotax Beneficial Owners If all the appropriate requirements have been established on a Form W-8BEN, W-8ECI, W-8EXP or, if applicable, on documentary evidence, you may treat the payee as a foreign beneficial owner. Form 1040x turbotax Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding. Form 1040x turbotax   This form is used by a foreign person to: Establish foreign status; Claim that such person is the beneficial owner of the income for which the form is being furnished or a partner in a partnership subject to section 1446 withholding; and If applicable, claim a reduced rate of, or exemption from, withholding under an income tax treaty. Form 1040x turbotax   Form W-8BEN also may be used to claim that the foreign person is exempt from Form 1099 reporting and backup withholding for income that is not subject to NRA withholding. Form 1040x turbotax For example, a foreign person may provide a Form W-8BEN to a broker to establish that the gross proceeds from the sale of securities are not subject to Form 1099 reporting or backup withholding. Form 1040x turbotax Claiming treaty benefits. Form 1040x turbotax   You may apply a reduced rate of withholding to a foreign person that provides a Form W-8BEN claiming a reduced rate of withholding under an income tax treaty only if the person provides a U. Form 1040x turbotax S. Form 1040x turbotax TIN and certifies that: It is a resident of a treaty country; It is the beneficial owner of the income; If it is an entity, it derives the income within the meaning of section 894 of the Internal Revenue Code (it is not fiscally transparent); and It meets any limitation on benefits provision contained in the treaty, if applicable. Form 1040x turbotax   If the foreign beneficial owner claiming a treaty benefit is related to you, the foreign beneficial owner also must certify on Form W-8BEN that it will file Form 8833, Treaty-Based Return Position Disclosure Under Section 6114 or 7701(b), if the amount subject to NRA withholding received during a calendar year exceeds, in the aggregate, $500,000. Form 1040x turbotax   An entity derives income for which it is claiming treaty benefits only if the entity is not treated as fiscally transparent for that income. Form 1040x turbotax See Fiscally transparent entity discussed earlier under Flow-Through Entities. Form 1040x turbotax   Limitations on benefits provisions generally prohibit third country residents from obtaining treaty benefits. Form 1040x turbotax For example, a foreign corporation may not be entitled to a reduced rate of withholding unless a minimum percentage of its owners are citizens or residents of the United States or the treaty country. Form 1040x turbotax   The exemptions from, or reduced rates of, U. Form 1040x turbotax S. Form 1040x turbotax tax vary under each treaty. Form 1040x turbotax You must check the provisions of the tax treaty that apply. Form 1040x turbotax Tables at the end of this publication show the countries with which the United States has income tax treaties and the rates of withholding that apply in cases where all conditions of the particular treaty articles are satisfied. Form 1040x turbotax   If you know, or have reason to know, that an owner of income is not eligible for treaty benefits claimed, you must not apply the treaty rate. Form 1040x turbotax You are not, however, responsible for misstatements on a Form W-8, documentary evidence, or statements accompanying documentary evidence for which you did not have actual knowledge, or reason to know, that the statements were incorrect. Form 1040x turbotax Exceptions to TIN requirement. Form 1040x turbotax   A foreign person does not have to provide a TIN to claim a reduced rate of withholding under a treaty if the requirements for the following exceptions are met. Form 1040x turbotax Income from marketable securities (discussed next). Form 1040x turbotax Unexpected payments to an individual (discussed under U. Form 1040x turbotax S. Form 1040x turbotax Taxpayer Identification Numbers ). Form 1040x turbotax Marketable securities. Form 1040x turbotax   A Form W-8BEN provided to claim treaty benefits does not need a U. Form 1040x turbotax S. Form 1040x turbotax TIN if the foreign beneficial owner is claiming the benefits on income from marketable securities. Form 1040x turbotax For this purpose, income from a marketable security consists of the following items. Form 1040x turbotax Dividends and interest from stocks and debt obligations that are actively traded. Form 1040x turbotax Dividends from any redeemable security issued by an investment company registered under the Investment Company Act of 1940 (mutual fund). Form 1040x turbotax Dividends, interest, or royalties from units of beneficial interest in a unit investment trust that are (or were upon issuance) publicly offered and are registered with the SEC under the Securities Act of 1933. Form 1040x turbotax Income related to loans of any of the above securities. Form 1040x turbotax Offshore accounts. Form 1040x turbotax   If a payment is made outside the United States to an offshore account, a payee may give you documentary evidence, rather than Form W-8BEN. Form 1040x turbotax   In most cases, a payment is made outside the United States if you complete the acts necessary to effect the payment outside the United States. Form 1040x turbotax However, an amount paid by a bank or other financial institution on a deposit or account usually will be treated as paid at the branch or office where the amount is credited. Form 1040x turbotax An offshore account is an account maintained at an office or branch of a U. Form 1040x turbotax S. Form 1040x turbotax or foreign bank or other financial institution at any location outside the United States. Form 1040x turbotax   You may rely on documentary evidence given to you by a nonqualified intermediary or a flow-through entity with its Form W-8IMY. Form 1040x turbotax This rule applies even though you make the payment to a nonqualified intermediary or flow-through entity in the United States. Form 1040x turbotax In most cases, the nonqualified intermediary or flow-through entity that gives you documentary evidence also will have to give you a withholding statement, discussed later. Form 1040x turbotax Documentary evidence. Form 1040x turbotax   You may apply a reduced rate of withholding to income from marketable securities (discussed earlier) paid outside the United States to an offshore account if the beneficial owner gives you documentary evidence in place of a Form W-8BEN. Form 1040x turbotax To claim treaty benefits, the documentary evidence must be one of the following: A certificate of residence that: Is issued by a tax official of the treaty country of which the foreign beneficial owner claims to be a resident, States that the person has filed its most recent income tax return as a resident of that country, and Is issued within 3 years prior to being presented to you. Form 1040x turbotax Documentation for an individual that: Includes the individual's name, address, and photograph, Is an official document issued by an authorized governmental body, and Is issued no more than 3 years prior to being presented to you. Form 1040x turbotax Documentation for an entity that: Includes the name of the entity, Includes the address of its principal office in the treaty country, and Is an official document issued by an authorized governmental body. Form 1040x turbotax In addition to the documentary evidence, a foreign beneficial owner that is an entity must provide a statement that it derives the income for which it claims treaty benefits and that it meets one or more of the conditions set forth in a limitation on benefits article, if any, (or similar provision) contained in the applicable treaty. Form 1040x turbotax 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. Form 1040x turbotax   This form is used by a foreign person to: Establish foreign status, Claim that such person is the beneficial owner of the income for which the form is being furnished, and Claim that the income is effectively connected with the conduct of a trade or business in the United States. Form 1040x turbotax (See Effectively Connected Income , later. Form 1040x turbotax )   Effectively connected income for which a valid Form W-8ECI has been provided is generally not subject to NRA withholding. Form 1040x turbotax   If a partner submits this form to a partnership, the income claimed to be effectively connected with the conduct of a U. Form 1040x turbotax S. Form 1040x turbotax trade or business is subject to withholding under section 1446. Form 1040x turbotax If the partner has made, or will make, an election under section 871(d) or 882(d), the partner must submit Form W-8ECI, and attach a copy of the election, or a statement of intent to elect, to the form. Form 1040x turbotax    If the partner's only effectively connected income is the income allocated from the partnership and the partner is not making the election under section 871(d) or 882(d), the partner should provide Form W-8BEN to the partnership. Form 1040x turbotax Form W-8EXP, Certificate of Foreign Government or Other Foreign Organization for United States Tax Withholding. Form 1040x turbotax   This form is used by a foreign government, international organization, foreign central bank of issue, foreign tax-exempt organization, foreign private foundation, or government of a U. Form 1040x turbotax S. Form 1040x turbotax possession to: Establish foreign status, Claim that such person is the beneficial owner of the income for which the form is being furnished, and Claim a reduced rate of, or an exemption from, withholding as such an entity. Form 1040x turbotax   If the government or organization is a partner in a partnership carrying on a trade or business in the United States, the effectively connected income allocable to the partner is subject to withholding under section 1446. Form 1040x turbotax   See Foreign Governments and Certain Other Foreign Organizations , later. Form 1040x turbotax Foreign Intermediaries and Foreign Flow-Through Entities Payments made to a foreign intermediary or foreign flow-through entity are treated as made to the payees on whose behalf the intermediary or entity acts. Form 1040x turbotax The Form W-8IMY provided by a foreign intermediary or flow-through entity must be accompanied by additional information for you to be able to reliably associate the payment with a payee. Form 1040x turbotax The additional information required depends on the type of intermediary or flow-through entity and the extent of the withholding responsibilities it assumes. Form 1040x turbotax Form W-8IMY, Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U. Form 1040x turbotax S. Form 1040x turbotax Branches for United States Tax Withholding. Form 1040x turbotax   This form is used by foreign intermediaries and foreign flow-through entities, as well as certain U. Form 1040x turbotax S. Form 1040x turbotax branches, to: Represent that a foreign person is a qualified intermediary or nonqualified intermediary, Represent, if applicable, that the qualified intermediary is assuming primary NRA withholding responsibility and/or primary Form 1099 reporting and backup withholding responsibility, Represent that a foreign partnership or a foreign simple or grantor trust is a withholding foreign partnership or a withholding foreign trust, Represent that a foreign flow-through entity is a nonwithholding foreign partnership, or a nonwithholding foreign trust and that the income is not effectively connected with the conduct of a trade or business in the United States, Represent that the provider is a U. Form 1040x turbotax S. Form 1040x turbotax branch of a foreign bank or insurance company and either is agreeing to be treated as a U. Form 1040x turbotax S. Form 1040x turbotax person or is transmitting documentation of the persons on whose behalf it is acting, or Represent that, for purposes of section 1446, it is an upper-tier foreign partnership or a foreign grantor trust and that the form is being used to transmit the required documentation. Form 1040x turbotax For information on qualifying as an upper-tier foreign partnership, see Regulations section 1. Form 1040x turbotax 1446-5. Form 1040x turbotax Qualified Intermediaries In most cases, a QI is any foreign intermediary that has entered into a QI withholding agreement (discussed earlier) with the IRS. Form 1040x turbotax A foreign intermediary that has received a QI employer identification number (QI-EIN) may represent on Form W-8IMY that it is a QI before it receives a fully executed agreement. Form 1040x turbotax The intermediary can claim that it is a QI until the IRS revokes its QI-EIN. Form 1040x turbotax The IRS will revoke a QI-EIN if the QI agreement is not executed and returned to the IRS within a reasonable period of time after the agreement was sent to the intermediary for signature. Form 1040x turbotax Responsibilities. Form 1040x turbotax   Payments made to a QI that does not assume NRA withholding responsibility are treated as paid to its account holders and customers. Form 1040x turbotax However, a QI is not required to provide you with documentation it obtains from its foreign account holders and customers. Form 1040x turbotax Instead, it provides you with a withholding statement that contains withholding rate pool information. Form 1040x turbotax A withholding rate pool is a payment of a single type of income, determined in accordance with the categories of income reported on Form 1042-S that is subject to a single rate of withholding. Form 1040x turbotax A qualified intermediary is required to provide you with information regarding U. Form 1040x turbotax S. Form 1040x turbotax persons subject to Form 1099 reporting and to provide you withholding rate pool information separately for each such U. Form 1040x turbotax S. Form 1040x turbotax person unless it has assumed Form 1099 reporting and backup withholding responsibility. Form 1040x turbotax For the alternative procedure for providing rate pool information for U. Form 1040x turbotax S. Form 1040x turbotax non-exempt persons, see the Form W-8IMY instructions. Form 1040x turbotax   The withholding statement must: Designate those accounts for which it acts as a qualified intermediary, Designate those accounts for which it assumes primary NRA withholding responsibility and/or primary Form 1099 and backup withholding responsibility, and Provide sufficient information for you to allocate the payment to a withholding rate pool. Form 1040x turbotax   The extent to which you must have withholding rate pool information depends on the withholding and reporting obligations assumed by the QI. Form 1040x turbotax Primary responsibility not assumed. Form 1040x turbotax   If a QI does not assume primary NRA withholding responsibility or primary Form 1099 reporting and backup withholding responsibility for the payment, you can reliably associate the payment with valid documentation only to the extent you can reliably determine the part of the payment that relates to each withholding rate pool for foreign payees. Form 1040x turbotax Unless the alternative procedure applies, the qualified intermediary must provide you with a separate withholding rate pool for each U. Form 1040x turbotax S. Form 1040x turbotax person subject to Form 1099 reporting and/or backup withholding. Form 1040x turbotax The QI must provide a Form W-9 or, in the absence of the form, the name, address, and TIN, if available, for such person. Form 1040x turbotax Primary NRA withholding responsibility assumed. Form 1040x turbotax   If you make a payment to a QI that assumes primary NRA withholding responsibility (but not primary Form 1099 reporting and backup withholding responsibility), you can reliably associate the payment with valid documentation only to the extent you can reliably determine the part of the payment that relates to the withholding rate pool for which the QI assumes primary NRA withholding responsibility and the part of the payment attributable to withholding rate pools for each U. Form 1040x turbotax S. Form 1040x turbotax person, unless the alternative procedure applies, subject to Form 1099 reporting and/or backup withholding. Form 1040x turbotax The QI must provide a Form W-9 or, in the absence of the form, the name, address, and TIN, if available, for such person. Form 1040x turbotax Primary NRA and Form 1099 responsibility assumed. Form 1040x turbotax   If you make a payment to a QI that assumes both primary NRA withholding responsibility and primary Form 1099 reporting and backup withholding responsibility, you can reliably associate a payment with valid documentation provided that you receive a valid Form W-8IMY. Form 1040x turbotax It is not necessary to associate the payment with withholding rate pools. Form 1040x turbotax Example. Form 1040x turbotax You make a payment of dividends to a QI. Form 1040x turbotax It has five customers: two are foreign persons who have provided documentation entitling them to a 15% rate of withholding on dividends; two are foreign persons subject to a 30% rate of withholding on dividends; and one is a U. Form 1040x turbotax S. Form 1040x turbotax individual who provides it with a Form W-9. Form 1040x turbotax Each customer is entitled to 20% of the dividend payment. Form 1040x turbotax The QI does not assume any primary withholding responsibility. Form 1040x turbotax The QI gives you a Form W-8IMY with which it associates the Form W-9 and a withholding statement that allocates 40% of the dividend to a 15% withholding rate pool, 40% to a 30% withholding rate pool, and 20% to the U. Form 1040x turbotax S. Form 1040x turbotax individual. Form 1040x turbotax You should report on Forms 1042-S 40% of the payment as made to a 15% rate dividend pool and 40% of the payment as made to a 30% rate dividend pool. Form 1040x turbotax The part of the payment allocable to the U. Form 1040x turbotax S. Form 1040x turbotax individual (20%) is reportable on Form 1099-DIV. Form 1040x turbotax Smaller partnerships and trusts. Form 1040x turbotax   A QI may apply special rules to a smaller partnership or trust (Joint Account Provision) only if the partnership or trust meets the following conditions. Form 1040x turbotax It is a foreign partnership or foreign simple or grantor trust. Form 1040x turbotax It is a direct account holder of the QI. Form 1040x turbotax It does not have any partner, beneficiary, or owner that is a U. Form 1040x turbotax S. Form 1040x turbotax person or a pass- through partner, beneficiary, or owner. Form 1040x turbotax   For information on these rules, see section 4A. Form 1040x turbotax 01 of the QI agreement. Form 1040x turbotax This is found in Appendix 3 of Revenue Procedure 2003-64. Form 1040x turbotax Also see Revenue Procedure 2004-21. Form 1040x turbotax Related partnerships and trusts. Form 1040x turbotax    A QI may apply special rules to a related partnership or trust only if the partnership or trust meets the following conditions. Form 1040x turbotax It is a foreign partnership or foreign simple or grantor trust. Form 1040x turbotax It is either: A direct account holder of the QI, or An indirect account holder of the QI that is a direct partner, beneficiary, or owner of a partnership or trust to which the QI has applied this rule. Form 1040x turbotax For information on these rules, see section 4A. Form 1040x turbotax 02 of the QI agreement. Form 1040x turbotax This is found in Appendix 3 of Revenue Procedure 2003-64. Form 1040x turbotax Also see Revenue Procedure 2005-77. Form 1040x turbotax Nonqualified Intermediaries If you are making a payment to an NQI, foreign flow-through entity, or U. Form 1040x turbotax S. Form 1040x turbotax branch that is using Form W-8IMY to transmit information about the branch's account holders or customers, you can treat the payment (or a part of the payment) as reliably associated with valid documentation from a specific payee only if, prior to making the payment: You can allocate the payment to a valid Form W-8IMY, You can reliably determine how much of the payment relates to valid documentation provided by a payee (a person that is not itself a foreign intermediary, flow- through entity, or U. Form 1040x turbotax S. Form 1040x turbotax branch), and You have sufficient information to report the payment on Form 1042-S or Form 1099, if reporting is required. Form 1040x turbotax The NQI, flow-through entity, or U. Form 1040x turbotax S. Form 1040x turbotax branch must give you certain information on a withholding statement that is associated with the Form W-8IMY. Form 1040x turbotax A withholding statement must be updated to keep the information accurate prior to each payment. Form 1040x turbotax Withholding statement. Form 1040x turbotax   In most cases, a withholding statement must contain the following information. Form 1040x turbotax The name, address, and TIN (if any, or if required) of each person for whom documentation is provided. Form 1040x turbotax The type of documentation (documentary evidence, Form W-8, or Form W-9) for every person for whom documentation has been provided. Form 1040x turbotax The status of the person for whom the documentation has been provided, such as whether the person is a U. Form 1040x turbotax S. Form 1040x turbotax exempt recipient (U. Form 1040x turbotax S. Form 1040x turbotax person exempt from Form 1099 reporting), U. Form 1040x turbotax S. Form 1040x turbotax non-exempt recipient (U. Form 1040x turbotax S. Form 1040x turbotax person subject to Form 1099 reporting), or a foreign person. Form 1040x turbotax For a foreign person, the statement must indicate whether the person is a beneficial owner or a foreign intermediary, flow-through entity, or a U. Form 1040x turbotax S. Form 1040x turbotax branch. Form 1040x turbotax The type of recipient the person is, based on the recipient codes used on Form 1042-S. Form 1040x turbotax Information allocating each payment, by income type, to each payee (including U. Form 1040x turbotax S. Form 1040x turbotax exempt and U. Form 1040x turbotax S. Form 1040x turbotax non-exempt recipients) for whom documentation has been provided. Form 1040x turbotax The rate of withholding that applies to each foreign person to whom a payment is allocated. Form 1040x turbotax A foreign payee's country of residence. Form 1040x turbotax If a reduced rate of withholding is claimed, the basis for a reduced rate of withholding (for example, portfolio interest, treaty benefit, etc. Form 1040x turbotax ). Form 1040x turbotax In the case of treaty benefits claimed by entities, whether the applicable limitation on benefits statement and the statement that the foreign person derives the income for which treaty benefits are claimed, have been made. Form 1040x turbotax The name, address, and TIN (if any) of any other NQI, flow-through entity, or U. Form 1040x turbotax S. Form 1040x turbotax branch from which the payee will directly receive a payment. Form 1040x turbotax Any other information a withholding agent requests to fulfill its reporting and withholding obligations. Form 1040x turbotax Alternative procedure. Form 1040x turbotax   Under this alternative procedure the NQI can give you the information that allocates each payment to each foreign and U. Form 1040x turbotax S. Form 1040x turbotax exempt recipient by January 31 following the calendar year of payment, rather than prior to the payment being made as otherwise required. Form 1040x turbotax To take advantage of this procedure, the NQI must: (a) inform you, on its withholding statement, that it is using the alternative procedure; and (b) obtain your consent. Form 1040x turbotax You must receive the withholding statement with all the required information (other than item 5) prior to making the payment. Form 1040x turbotax    This alternative procedure cannot be used for payments to U. Form 1040x turbotax S. Form 1040x turbotax non-exempt recipients. Form 1040x turbotax Therefore, an NQI must always provide you with allocation information for all U. Form 1040x turbotax S. Form 1040x turbotax non-exempt recipients prior to a payment being made. Form 1040x turbotax Pooled withholding information. Form 1040x turbotax   If an NQI uses the alternative procedure, it must provide you with withholding rate pool information, as opposed to individual allocation information, prior to the payment of a reportable amount. Form 1040x turbotax A withholding rate pool is a payment of a single type of income (as determined by the income categories on Form 1042-S) that is subject to a single rate of withholding. Form 1040x turbotax For example, an NQI that has foreign account holders receiving royalties and dividends, both subject to the 15% rate, will provide you with information for two withholding rate pools (one for royalties and one for dividends). Form 1040x turbotax The NQI must provide you with the payee specific allocation information (information allocating each payment to each payee) by January 31 following the calendar year of payment. Form 1040x turbotax Failure to provide allocation information. Form 1040x turbotax   If an NQI fails to provide you with the payee specific allocation information for a withholding rate pool by January 31, you must not apply the alternative procedure to any of the NQI's withholding rate pools from that date forward. Form 1040x turbotax You must treat the payees as undocumented and apply the presumption rules, discussed later in Presumption Rules . Form 1040x turbotax An NQI is deemed to have f
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Marine Corps

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The Form 1040x Turbotax

Form 1040x turbotax Publication 80 - Introductory Material Table of Contents Future Developments What's New Reminders Calendar Future Developments For the latest information about developments related to Publication 80 (Circular SS), such as legislation enacted after it was published, go to www. Form 1040x turbotax irs. Form 1040x turbotax gov/pub80. Form 1040x turbotax What's New Social security and Medicare tax for 2014. Form 1040x turbotax  The social security tax rate is 6. Form 1040x turbotax 2% each for the employee and employer, unchanged from 2013. Form 1040x turbotax The social security wage base limit is $117,000. Form 1040x turbotax The Medicare tax rate is 1. Form 1040x turbotax 45% each for the employee and employer, unchanged from 2013. Form 1040x turbotax There is no wage base limit for Medicare tax. Form 1040x turbotax Social security and Medicare taxes apply to the wages of household workers you pay $1,900 or more in cash or an equivalent form of compensation. Form 1040x turbotax Social security and Medicare taxes apply to election workers who are paid $1,600 or more in cash or an equivalent form of compensation. Form 1040x turbotax Change of responsible party. Form 1040x turbotax . Form 1040x turbotax  Beginning January 1, 2014, any entity with an employer identification number (EIN) must file Form 8822-B, Change of Address or Responsible Party—Business, to report the latest change to its responsible party. Form 1040x turbotax Form 8822-B must be filed within 60 days of the change. Form 1040x turbotax If the change in the identity of your responsible party occurred before 2014, and you have not previously notified the IRS of the change, file Form 8822-B before March 1, 2014, reporting only the most recent change. Form 1040x turbotax For a definition of “responsible party”, see the Form 8822-B instructions. Form 1040x turbotax Same-sex marriage. Form 1040x turbotax  For federal tax purposes, individuals of the same sex are considered married if they were lawfully married in a state (or foreign country) whose laws authorize the marriage of two individuals of the same sex, even if the state (or foreign country) in which they now live does not recognize same-sex marriage. Form 1040x turbotax For more information, see Revenue Ruling 2013-17, 2013-38 I. Form 1040x turbotax R. Form 1040x turbotax B. Form 1040x turbotax 201, available at www. Form 1040x turbotax irs. Form 1040x turbotax gov/irb/2013-38_IRB/ar07. Form 1040x turbotax html. Form 1040x turbotax Notice 2013-61 provides special administrative procedures for employers to make claims for refund or adjustments of overpayments of social security and Medicare taxes with respect to certain same-sex spouse benefits before expiration of the period of limitations. Form 1040x turbotax Notice 2013-61, 2013-44 I. Form 1040x turbotax R. Form 1040x turbotax B. Form 1040x turbotax 432, is available at www. Form 1040x turbotax irs. Form 1040x turbotax gov/irb/2013-44_IRB/ar10. Form 1040x turbotax html. Form 1040x turbotax Reminders Additional Medicare Tax withholding. Form 1040x turbotax  In addition to withholding Medicare tax at 1. Form 1040x turbotax 45%, you must withhold a 0. Form 1040x turbotax 9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. Form 1040x turbotax You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Form 1040x turbotax Additional Medicare Tax is only imposed on the employee. Form 1040x turbotax There is no employer share of Additional Medicare Tax. Form 1040x turbotax All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold. Form 1040x turbotax For more information on what wages are subject to Medicare tax, see the chart, Special Rules for Various Types of Employment and Payments , in section 12. Form 1040x turbotax For more information on Additional Medicare Tax, visit IRS. Form 1040x turbotax gov and enter “Additional Medicare Tax” in the search box. Form 1040x turbotax Work opportunity tax credit for qualified tax-exempt organizations hiring qualified veterans. Form 1040x turbotax  The work opportunity tax credit is available for eligible unemployed veterans who begin work on or after November 22, 2011, and before January 1, 2014. Form 1040x turbotax Qualified tax-exempt organizations that hire eligible unemployed veterans can claim the work opportunity tax credit against their payroll tax liability using Form 5884-C, Work Opportunity Credit for Qualified Tax-Exempt Organizations Hiring Qualified Veterans. Form 1040x turbotax For more information, visit IRS. Form 1040x turbotax gov and enter “work opportunity tax credit” in the search box. Form 1040x turbotax Outsourcing payroll duties. Form 1040x turbotax  Employers are responsible to ensure that tax returns are filed and deposits and payments are made, even if the employer contracts with a third party to perform these acts. Form 1040x turbotax The employer remains responsible if the third party fails to perform any required action. Form 1040x turbotax If you choose to outsource any of your payroll and related tax duties (that is, withholding, reporting, and paying over social security, Medicare, FUTA, and income taxes) to a third-party payer such as a payroll service provider or reporting agent, visit IRS. Form 1040x turbotax gov and enter “outsourcing payroll duties” in the search box for helpful information on this topic. Form 1040x turbotax Residents of the Philippines working in the Commonwealth of the Northern Mariana Islands (CNMI). Form 1040x turbotax  The IRS will not assert that an employer has understated liability for social security and Medicare taxes because they failed to treat services performed before January 1, 2015, in the CNMI by a resident of the Philippines as employment as defined under Internal Revenue Code section 3121(b). Form 1040x turbotax For more information, see Announcement 2012-43, 2012-51 I. Form 1040x turbotax R. Form 1040x turbotax B. Form 1040x turbotax 723, available at www. Form 1040x turbotax irs. Form 1040x turbotax gov/irb/2012-51_IRB/ar15. Form 1040x turbotax html. Form 1040x turbotax CNMI government employees now subject to social security and Medicare taxes. Form 1040x turbotax  Beginning in the fourth calendar quarter of 2012, CNMI government employees are subject to social security and Medicare taxes. Form 1040x turbotax COBRA premium assistance credit. Form 1040x turbotax  The credit for COBRA premium assistance payments applies to premiums paid for employees involuntarily terminated between September 1, 2008 and May 31, 2010, and to premiums paid for up to 15 months. Form 1040x turbotax See COBRA premium assistance credit in Publication 15 (Circular E), Employer's Tax Guide. Form 1040x turbotax You can get Publication 15 (Circular E) at IRS. Form 1040x turbotax gov. Form 1040x turbotax You must receive written notice from the IRS to file Form 944. Form 1040x turbotax  If you have been filing Forms 941-SS and believe your employment taxes for the calendar year will be $1,000 or less, and you would like to file Form 944, Employer's ANNUAL Federal Tax Return, instead of Forms 941-SS, you must contact the IRS to request to file Form 944. Form 1040x turbotax You must receive written notice from the IRS to file Form 944 instead of Forms 941-SS before you may file this form. Form 1040x turbotax For more information on requesting to file Form 944 visit IRS. Form 1040x turbotax gov and enter “file employment taxes annually” in the search box. Form 1040x turbotax Federal employers in the CNMI. Form 1040x turbotax  The U. Form 1040x turbotax S. Form 1040x turbotax Treasury Department and the CNMI Division of Revenue and Taxation entered into an agreement under 5 USC 5517 in December 2006. Form 1040x turbotax Under this agreement, all federal employers (including the Department of Defense) are required to withhold CNMI income taxes (rather than federal income taxes) and deposit the CNMI taxes with the CNMI Treasury for employees who are subject to CNMI taxes and whose regular place of federal employment is in the CNMI. Form 1040x turbotax Federal employers are also required to file quarterly and annual reports with the CNMI Division of Revenue and Taxation. Form 1040x turbotax For questions, contact the CNMI Division of Revenue and Taxation. Form 1040x turbotax Change of address. Form 1040x turbotax  Use Form 8822-B to notify the IRS of an address change. Form 1040x turbotax Do not mail Form 8822-B with your employment tax return. Form 1040x turbotax Federal tax deposits must be made by electronic funds transfer. Form 1040x turbotax  You must use electronic funds transfer to make all federal tax deposits. Form 1040x turbotax Generally, electronic fund transfers are made using the Electronic Federal Tax Payment System (EFTPS). Form 1040x turbotax If you do not want to use EFTPS, you can arrange for your tax professional, financial institution, payroll service, or other trusted third party to make electronic deposits on your behalf. Form 1040x turbotax Also, you may arrange for your financial institution to initiate a same-day wire payment on your behalf. Form 1040x turbotax EFTPS is a free service provided by the Department of Treasury. Form 1040x turbotax Services provided by your tax professional, financial institution, payroll service, or other third party may have a fee. Form 1040x turbotax For more information on making federal tax deposits, see How To Deposit in section 8. Form 1040x turbotax For more information about EFTPS or to enroll in EFTPS, visit the EFTPS website at www. Form 1040x turbotax eftps. Form 1040x turbotax gov or call 1-800-555-4477 (U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands only) or 303-967-5916 (toll call) or 1-800-733-4829 (TDD). Form 1040x turbotax Additional information about EFTPS is also available in Publication 966, Electronic Federal Tax Payment System: A Guide To Getting Started. Form 1040x turbotax Electronic filing and payment. Form 1040x turbotax  Using electronic options can make filing a return and paying your federal tax easier. Form 1040x turbotax Use the Electronic Federal Tax Payment System (EFTPS) to make deposits or pay in full, whether you rely on a tax professional or prepare your own taxes. Form 1040x turbotax You can use IRS e-file to file certain returns. Form 1040x turbotax If there is a balance due on the return, you can e-file and e-pay in a single step by authorizing an electronic funds withdrawal (EFW) from your bank account while e-filing. Form 1040x turbotax Do not use EFW to pay taxes that are required to be deposited. Form 1040x turbotax Visit the IRS website at www. Form 1040x turbotax irs. Form 1040x turbotax gov/efile for more information on filing electronically. Form 1040x turbotax For more information on paying your taxes using EFW, visit the IRS website at www. Form 1040x turbotax irs. Form 1040x turbotax gov/e-pay. Form 1040x turbotax A fee may be charged to file electronically. Form 1040x turbotax For EFTPS, visit www. Form 1040x turbotax eftps. Form 1040x turbotax gov or call EFTPS Customer Service at 1-800-555-4477 (U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands only) or 303-967-5916 (toll call). Form 1040x turbotax For electronic filing of Forms W-2AS, W-2CM, W-2GU, W-2VI, Wage and Tax Statements; W-3SS, Transmittal of Wage and Tax Statements; and W-2c, Corrected Wage and Tax Statement, visit www. Form 1040x turbotax socialsecurity. Form 1040x turbotax gov/employer. Form 1040x turbotax If you are filing your tax return or paying your federal taxes electronically, a valid EIN is required. Form 1040x turbotax If a valid EIN is not provided, the return or payment will not be processed. Form 1040x turbotax This may result in penalties and delays in processing your return or payment. Form 1040x turbotax Electronic option for filing Forms W-2AS, W-2CM, W-2GU, or W-2VI. Form 1040x turbotax  Employers in American Samoa, the CNMI, Guam, and the U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands can now use the Social Security Administration's W-2 Online service to create, save, print, and submit up to 50 Forms W-2AS, W-2CM, W-2GU, or W-2VI at a time over the Internet. Form 1040x turbotax Form W-3SS will be generated automatically based on your Forms W-2AS, W-2CM, W-2GU, or W-2VI. Form 1040x turbotax For more information, visit Social Security Administration's SSA website at www. Form 1040x turbotax ssa. Form 1040x turbotax gov/bso/bsowelcome. Form 1040x turbotax htm. Form 1040x turbotax Credit or debit card payments. Form 1040x turbotax  For information on paying your taxes with a credit or debit card, visit the IRS website at www. Form 1040x turbotax irs. Form 1040x turbotax gov/e-pay. Form 1040x turbotax However, do not use credit or debit cards to make federal tax deposits. Form 1040x turbotax Hiring new employees. Form 1040x turbotax  Record the number and name from each new employee's social security card. Form 1040x turbotax An employee who does not have a social security card should apply for one on Form SS-5, Application for a Social Security Card. Form 1040x turbotax See section 3. Form 1040x turbotax Reporting discrepancies between Forms 941-SS (or Form 944) and Forms W-2. Form 1040x turbotax  File Schedule D (Form 941), Report of Discrepancies Caused by Acquisitions, Statutory Mergers, or Consolidations, to explain certain wage, tax, and payment discrepancies between Forms 941-SS (or Form 944), and Forms W-2 that were caused by acquisitions, statutory mergers, or consolidations. Form 1040x turbotax For more information, see the Instructions for Schedule D (Form 941). Form 1040x turbotax Apply for an employer identification number (EIN) online. Form 1040x turbotax  You can apply for an EIN online by visiting IRS. Form 1040x turbotax gov and clicking on the Apply for an EIN Online link under Tools. Form 1040x turbotax Dishonored payments. Form 1040x turbotax  Any form of payment that is dishonored and returned from a financial institution is subject to a penalty. Form 1040x turbotax The penalty is $25 or 2% of the payment, whichever is more. Form 1040x turbotax However, the penalty on dishonored payments of $24. Form 1040x turbotax 99 or less is an amount equal to the payment. Form 1040x turbotax For example, a dishonored payment of $18 is charged a penalty of $18. Form 1040x turbotax Private delivery services. Form 1040x turbotax  You can use certain private delivery services designated by the IRS to send tax returns or payments. Form 1040x turbotax The list includes only the following: DHL Express (DHL): DHL Same Day Service. Form 1040x turbotax Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx International Priority, and FedEx International First. Form 1040x turbotax United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver, UPS 2nd Day Air, UPS 2nd Day Air A. Form 1040x turbotax M. Form 1040x turbotax , UPS Worldwide Express Plus, and UPS Worldwide Express. Form 1040x turbotax For the IRS mailing address to use if you are using a private delivery service, go to IRS. Form 1040x turbotax gov and enter “private delivery service” in the search box. Form 1040x turbotax Your private delivery service can tell you how to get written proof of the mailing date. Form 1040x turbotax Private delivery services cannot deliver items to P. Form 1040x turbotax O. Form 1040x turbotax boxes. Form 1040x turbotax You must use the U. Form 1040x turbotax S. Form 1040x turbotax Postal Service to mail any item to an IRS P. Form 1040x turbotax O. Form 1040x turbotax box address. Form 1040x turbotax Recordkeeping. Form 1040x turbotax  Keep all records of employment taxes for 4 years. Form 1040x turbotax These should be available for IRS review. Form 1040x turbotax There is no required format for such records, but they should include your EIN; the amounts and dates of all wage payments (including fringe benefits) and tips reported; the names, addresses, and occupations of employees receiving such payments and their social security numbers; copies of returns filed; dates of employment; and the dates and amounts of deposits made. Form 1040x turbotax Farm employers must keep a record of the name, permanent address, and EIN of each crew leader. Form 1040x turbotax See Farm Crew Leaders in section 2. Form 1040x turbotax Disregarded entities and qualified subchapter S subsidiaries (QSubs). Form 1040x turbotax  Eligible single-owner disregarded entities and QSubs are treated as separate entities for employment tax purposes. Form 1040x turbotax Eligible single-member entities that have not elected to be taxed as corporations must report and pay employment taxes on wages paid to their employees using the entities' own names and EINs. Form 1040x turbotax See Regulations sections 1. Form 1040x turbotax 1361-4(a)(7) and 301. Form 1040x turbotax 7701-2(c)(2)(iv). Form 1040x turbotax Photographs of missing children. Form 1040x turbotax  The IRS is a proud partner with the National Center for Missing and Exploited Children. Form 1040x turbotax Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Form 1040x turbotax You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. Form 1040x turbotax Calendar   If any date for filing a return, furnishing a form, or depositing taxes falls on a Saturday, Sunday, or legal holiday, the due date is the next business day. Form 1040x turbotax A statewide legal holiday delays a filing due date only if the IRS office where you are required to file is located in that state. Form 1040x turbotax However, a statewide legal holiday does not delay the due date of federal tax deposits. Form 1040x turbotax See Deposits on Business Days Only in section 8. Form 1040x turbotax For any filing due date, you will meet the “file” or “furnish” requirement if the envelope containing the return or form is properly addressed, contains sufficient postage, and is postmarked by the U. Form 1040x turbotax S. Form 1040x turbotax Postal Service on or before the due date, or sent by an IRS-designated delivery service on or before the due date. Form 1040x turbotax See Private delivery services under Reminders. Form 1040x turbotax The following are important dates and responsibilities. Form 1040x turbotax Also see Publication 509, Tax Calendars. Form 1040x turbotax By January 31. Form 1040x turbotax   Furnish wage and tax statements to employees. Form 1040x turbotax Give each employee a completed Form W-2AS, W-2CM, W-2GU, or W-2VI. Form 1040x turbotax See section 10 for more information. Form 1040x turbotax File Form 943, Employer's Annual Federal Tax Return for Agricultural Employees, with the IRS. Form 1040x turbotax If you deposited all Form 943 taxes when due, you have 10 additional calendar days to file. Form 1040x turbotax U. Form 1040x turbotax S. Form 1040x turbotax Virgin Islands employers only must file Form 940, Employer's Annual Federal Unemployment (FUTA) Tax Return, with the IRS. Form 1040x turbotax Pay or deposit (if more than $500) any balance of the tax due. Form 1040x turbotax If you deposited the full amount of taxes when due, you have 10 additional calendar days to file. Form 1040x turbotax File Form 944 with the IRS if you were notified by the IRS to file Form 944 instead of quarterly Forms 941-SS. Form 1040x turbotax If you deposited the full amount of taxes when due, you have 10 additional calendar days to file. Form 1040x turbotax By February 28. Form 1040x turbotax  File paper wage and tax statements with the Social Security Administration (SSA). Form 1040x turbotax File Copy A of Forms W-2AS, W-2CM, W-2GU, or W-2VI, and Form W-3SS with the Social Security Administration (SSA). Form 1040x turbotax For electronically filed returns, see By March 31 next. Form 1040x turbotax By March 31. Form 1040x turbotax  File electronic Forms W-2AS, W-2CM, W-2GU, or W-2VI with the SSA. Form 1040x turbotax Visit the SSA's Reporting Instructions & Information webpage at www. Form 1040x turbotax socialsecurity. Form 1040x turbotax gov/employer for more information. Form 1040x turbotax By April 30, July 31, October 31, and January 31. Form 1040x turbotax  File Form 941-SS with the IRS. Form 1040x turbotax If you deposited the full amount of taxes when due, you have 10 additional calendar days to file. Form 1040x turbotax Do not file Forms 941-SS for these quarters if you have been notified to file Form 944 and you did not request to file quarterly Forms 941-SS. Form 1040x turbotax Deposit FUTA tax for the quarter (including any amount carried over from other quarters) if over $500. Form 1040x turbotax If $500 or less, carry it over to the next quarter. Form 1040x turbotax See section 11 for more information. Form 1040x turbotax Prev  Up  Next   Home   More Online Publications