Tax Documentation FAQ

What is a “Tax Document”?

For purposes of these FAQs, a Tax Document refers to one of the following IRS-issued forms:

• Form W-9, Request for Taxpayer Identification Number and Certification
• Form W-8BEN, Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals)
• Form W-8BEN-E, Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities)

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Note: The IRS has also issued additional tax documents (i.e. Form W-8EXP, W-8ECI, & W-8IMY) , that are currently not supported by TaxBit.

What is a Form W-9?

A Form W-9 is completed by US residents or citizens and is used to establish an individual and entity’s US tax status, as well as collect and confirm the tax identification number (TIN), either Social Security Number (SSN) or Employer Identification Number (EIN). The information provided on a Form W-9 is commonly used to complete, and file a Form 1099.

For US tax purposes, the definition of a US person includes:

• A citizen or resident of the United States
• A domestic partnership
• A domestic corporation
• Any estate other than a foreign estate
• Any trust if:
  • A court within the United States is able to exercise primary supervision over the administration of the trust, and
  • One or more United States persons have the authority to control all substantial decisions of the trust
• Any other person that is not a foreign person

An individual may be considered a US resident for tax purposes if they meet the Substantial Presence Test for a calendar year.

What is a Form W-8?

The W-8 (Series) Forms are completed by non-US residents, and are commonly used to establish an individual or entity’s Non-US status, and provide other related information, if applicable. The different types of Forms W-8 are completed based on the type of end customer providing the form, and sometimes the type of income being received. For example, Individuals will always fill out a Form W-8BEN, while Corporations will likely fill out a Form W-8BEN-E.

A Form W-8 is collected to facilitate reporting related to certain payments of US Fixed, Determinable, Annual & Periodic (FDAP) income on Forms 1042-S.

Why is a Tax Document collected?

In general, a Tax Document is collected for purposes of identifying whether an end customer is a US Person, and assists in determining whether an end customer should receive certain year-end information return (i.e., Forms 1099, 1042-s, etc.).

For clarity, TaxBit assists with the collection of Tax Documents at the request of platforms. An end customer should contact the platform that is requesting a Tax Document with any questions regarding why a Tax Document is being requested.