Form W-9 and W-8BEN

W-9 Tax Form 

Financial institutions will often ask US citizen clients to complete a Form W-9. The form asks for personal identification information (name, address, SSN) to identify U.S. citizens to be shared with the IRS. In Israel, it is becoming very common for banks, investment advisors and pension funds to have clients submit a Form W-9.

The details included on W-9 forms are important because they give the paying company an understanding of what kind of entity they are paying, based on information such as address and TIN. The Internal Revenue Service (IRS) uses W-9 forms to check the income reported by recipients against the payments reported by the paying company.

W-8BEN Tax Form

Financial institutions will sometimes ask foreign businesses and non-US citizens that earn income from US sources to submit a Form W-8. The main purpose is to let the financial institutions know that the person or company earning income from a US source is not subject to the usual tax withholding from investment income.

If you are a non-US person that does business in the US, Form W-8BEN will establish your foreign status and allow you to claim tax exemption, or reduced tax rates, on US-sourced income. The US has an income tax treaty in place and FORM W-8BEN will establish your eligibility of treaty benefits. Failure to submit a Form W-8BEN could result in paying either the full 30% rate or the backup withholding rate under section 3406.

How We Can Help

Our team of experienced tax professionals helped hundreds of US and non-US citizens with their W-9 and W-8BEN forms and we’ll be happy to help you too. Contact us to get started.