Section references are to the Internal Revenue Code unless otherwise noted.
Purpose of form.
Foreign persons are subject to U.S. tax at a 30% rate on income they receive from U.S. sources that consists of:
Interest (including certain original issue discount (OID));
Compensation for, or in expectation of, services performed;
Substitute payments in a securities lending transaction; or
Other fixed or determinable annual or periodical gains, profits, or income.
This tax is imposed on the gross amount paid and is generally collected by withholding under section 1441 or 1442
on that amount. A payment is
considered to have been made whether it is made directly to the beneficial owner or to another person, such as an intermediary,
agent, or partnership,
for the benefit of the beneficial owner.
In addition, section 1446 requires a partnership conducting a trade or business in the United States to withhold tax
on a foreign partner's
distributive share of the partnership's effectively connected taxable income. Generally, a foreign person that is a partner
in a partnership that
submits a Form W-8 for purposes of section 1441 or 1442 will satisfy the documentation requirements under section 1446 as
well. However, in some cases
the documentation requirements of sections 1441 and 1442 do not match the documentation requirements of section 1446. See
1.1446-1 through 1.1446-6. Further, the owner of a disregarded entity, rather than the disregarded entity itself, shall submit
the appropriate Form
W-8 for purposes of section 1446.
If you receive certain types of income, you must provide Form W-8BEN to:
Establish that you are not a U.S. person;
Claim that you are the beneficial owner of the income for which Form W-8BEN is being provided or a partner in a partnership
section 1446; and
If applicable, claim a reduced rate of, or exemption from, withholding as a resident of a foreign country with which the United
an income tax treaty.
You may also be required to submit Form W-8BEN to claim an exception from domestic information reporting and backup
withholding for certain types
of income that are not subject to foreign-person withholding. Such income includes:
Short-term (183 days or less) original issue discount (OID).
Bank deposit interest.
Foreign source interest, dividends, rents, or royalties.
Proceeds from a wager placed by a nonresident alien individual in the games of blackjack, baccarat, craps, roulette, or big-6
You may also use Form W-8BEN to certify that income from a notional principal contract is not effectively connected
with the conduct of a trade or
business in the United States.
A withholding agent or payer of the income may rely on a properly completed Form W-8BEN to treat a payment associated
with the Form W-8BEN as a
payment to a foreign person who beneficially owns the amounts paid. If applicable, the withholding agent may rely on the Form
W-8BEN to apply a
reduced rate of withholding at source.
Provide Form W-8BEN to the withholding agent or payer before income is paid or credited to you. Failure to provide
a Form W-8BEN when requested may
lead to withholding at a 30% rate (foreign-person withholding) or the backup withholding rate.
Giving Form W-8BEN to the withholding agent.
Do not send Form W-8BEN to the IRS. Instead, give it to the person who is requesting it from you. Generally, this
will be the person from whom you
receive the payment, who credits your account, or a partnership that allocates income to you. Give Form W-8BEN to the person
requesting it before the
payment is made to you, credited to your account or allocated. If you do not provide this form, the withholding agent may
have to withhold at the 30%
rate, backup withholding rate, or the rate applicable under section 1446. If you receive more than one type of income from
a single withholding agent
for which you claim different benefits, the withholding agent may, at its option, require you to submit a Form W-8BEN for
each different type of
income. Generally, a separate Form W-8BEN must be given to each withholding agent.
If you own the income or account jointly with one or more other persons, the income or account will be treated by
the withholding agent as owned by
a foreign person if Forms W-8BEN are provided by all of the owners. If the withholding agent receives a Form W-9 from any
of the joint owners, the
payment must be treated as made to a U.S. person.
Change in circumstances.
If a change in circumstances makes any information on the Form W-8BEN you have submitted incorrect, you must notify
the withholding agent or payer
within 30 days of the change in circumstances and you must file a new Form W-8BEN or other appropriate form.
If you use Form W-8BEN to certify that you are a foreign person, a change of address to an address in the United States
is a change in
circumstances. Generally, a change of address within the same foreign country or to another foreign country is not a change
in circumstances. However,
if you use Form W-8BEN to claim treaty benefits, a move to the United States or outside the country where you have been claiming
treaty benefits is a
change in circumstances. In that case, you must notify the withholding agent or payer within 30 days of the move.
If you become a U.S. citizen or resident alien after you submit Form W-8BEN, you are no longer subject to the 30%
withholding rate or the
withholding tax on a foreign partner's share of effectively connected income. You must notify the withholding agent or payer
within 30 days of
becoming a U.S. citizen or resident alien. You may be required to provide a Form W-9. For more information, see Form W-9 and
Expiration of Form W-8BEN.
Generally, a Form W-8BEN provided without a U.S. taxpayer identification number (TIN) will remain in effect for a
period starting on the date the
form is signed and ending on the last day of the third succeeding calendar year, unless a change in circumstances makes any
information on the form
incorrect. For example, a Form W-8BEN signed on September 30, 2005, remains valid through December 31, 2008. A Form W-8BEN
furnished with a U.S. TIN
will remain in effect until a change in circumstances makes any information on the form incorrect, provided that the withholding
agent reports on Form
1042-S at least one payment annually to the beneficial owner who provided the Form W-8BEN. See the instructions for line 6
beginning on page 4 for
circumstances under which you must provide a U.S. TIN.
For payments other than those for which a reduced rate of withholding is claimed under an income tax treaty, the beneficial
owner of income is
generally the person who is required under U.S. tax principles to include the income in gross income on a tax return. A person
is not a beneficial
owner of income, however, to the extent that person is receiving the income as a nominee, agent, or custodian, or to the extent
the person is a
conduit whose participation in a transaction is disregarded. In the case of amounts paid that do not constitute income, beneficial
determined as if the payment were income.
Foreign partnerships, foreign simple trusts, and foreign grantor trusts are not the beneficial owners of income paid
to the partnership or trust.
The beneficial owners of income paid to a foreign partnership are generally the partners in the partnership, provided that
the partner is not itself a
partnership, foreign simple or grantor trust, nominee or other agent. The beneficial owners of income paid to a foreign simple
trust (that is, a
foreign trust that is described in section 651(a)) are generally the beneficiaries of the trust, if the beneficiary is not
a foreign partnership,
foreign simple or grantor trust, nominee or other agent. The beneficial owners of a foreign grantor trust (that is, a foreign
trust to the extent that
all or a portion of the income of the trust is treated as owned by the grantor or another person under sections 671 through
679) are the persons
treated as the owners of the trust. The beneficial owners of income paid to a foreign complex trust (that is, a foreign trust
that is not a foreign
simple trust or foreign grantor trust) is the trust itself.
For purposes of section 1446, the same beneficial owner rules apply, except that under section 1446 a foreign simple
trust rather than the
beneficiary provides the form to the partnership.
The beneficial owner of income paid to a foreign estate is the estate itself.
A payment to a U.S. partnership, U.S. trust, or U.S. estate is treated as a payment to a U.S. payee that is not subject to
30% withholding. A U.S.
partnership, trust, or estate should provide the withholding agent with a Form W-9. For purposes of section 1446, a U.S. grantor
trust or disregarded
entity shall not provide the withholding agent a Form W-9 in its own right. Rather, the grantor or other owner shall provide
the withholding agent the
A foreign person includes a nonresident alien individual, a foreign corporation, a foreign partnership, a foreign
trust, a foreign estate, and any
other person that is not a U.S. person. It also includes a foreign branch or office of a U.S. financial institution or U.S.
clearing organization if
the foreign branch is a qualified intermediary. Generally, a payment to a U.S. branch of a foreign person is a payment to
a foreign person.
Nonresident alien individual.
Any individual who is not a citizen or resident alien of the United States is a nonresident alien individual. An alien
individual meeting either
the “green card test
” or the “substantial presence test
” for the calendar year is a resident alien. Any person not meeting either test is a
nonresident alien individual. Additionally, an alien individual who is a resident of a foreign country under the residence
article of an income tax
treaty, or an alien individual who is a bona fide resident of Puerto Rico, Guam, the Commonwealth of the Northern Mariana
Islands, the U.S. Virgin
Islands, or American Samoa is a nonresident alien individual. See Pub. 519, U.S. Tax Guide for Aliens, for more information
on resident and
nonresident alien status.
Even though a nonresident alien individual married to a U.S. citizen or resident alien may choose to be treated as a resident
alien for certain
purposes (for example, filing a joint income tax return), such individual is still treated as a nonresident alien for withholding
tax purposes on all
income except wages.
A flow-through entity is a foreign partnership (other than a withholding foreign partnership), a foreign simple or
foreign grantor trust (other
than a withholding foreign trust), or, for payments for which a reduced rate of withholding is claimed under an income tax
treaty, any entity to the
extent the entity is considered to be fiscally transparent (see below) with respect to the payment by an interest holder's
For purposes of section 1446, a foreign partnership or foreign grantor trust must submit Form W-8IMY to establish
the partnership or grantor trust
as a look through entity. The Form W-8IMY may be accompanied by this form or another version of Form W-8 or Form W-9 to establish
the foreign or
domestic status of a partner or grantor or other owner. See Regulations section 1.1446-1.
A hybrid entity is any person (other than an individual) that is treated as fiscally transparent (see below) in the
United States but is not
treated as fiscally transparent by a country with which the United States has an income tax treaty. Hybrid entity status is
relevant for claiming
treaty benefits. See the instructions for line 9c on page 5.
Reverse hybrid entity.
A reverse hybrid entity is any person (other than an individual) that is not fiscally transparent under U.S. tax law
principles but that is
fiscally transparent under the laws of a jurisdiction with which the United States has an income tax treaty. See the instructions
for line 9c on page
Fiscally transparent entity.
An entity is treated as fiscally transparent with respect to an item of income for which treaty benefits are claimed
to the extent that the
interest holders in the entity must, on a current basis, take into account separately their shares of an item of income paid
to the entity, whether or
not distributed, and must determine the character of the items of income as if they were realized directly from the sources
from which realized by the
entity. For example, partnerships, common trust funds, and simple trusts or grantor trusts are generally considered to be
fiscally transparent with
respect to items of income received by them.
A business entity that has a single owner and is not a corporation under Regulations section 301.7701-2(b) is disregarded
as an entity separate
from its owner.
A disregarded entity shall not submit this form to a partnership for purposes of section 1446. Instead, the owner
of such entity shall provide
appropriate documentation. See Regulations section 1.1446-1.
Amounts subject to withholding.
Generally, an amount subject to withholding is an amount from sources within the United States that is fixed or determinable
annual or periodical
(FDAP) income. FDAP income is all income included in gross income, including interest (as well as OID), dividends, rents,
royalties, and compensation.
FDAP income does not include most gains from the sale of property (including market discount and option premiums).
For purposes of section 1446, the amount subject to withholding is the foreign partner's share of the partnership's
effectively connected taxable
Any person, U.S. or foreign, that has control, receipt, or custody of an amount subject to withholding or who can
disburse or make payments of an
amount subject to withholding is a withholding agent. The withholding agent may be an individual, corporation, partnership,
trust, association, or any
other entity, including (but not limited to) any foreign intermediary, foreign partnership, and U.S. branches of certain foreign
banks and insurance
companies. Generally, the person who pays (or causes to be paid) the amount subject to withholding to the foreign person (or
to its agent) must
For purposes of section 1446, the withholding agent is the partnership conducting the trade or business in the United
States. For a publicly traded
partnership, the withholding agent may be the partnership, a nominee holding an interest on behalf of a foreign person, or
both. See Regulations
sections 1.1446-1 through 1.1446-6.