Liquid was built to make it easier for US companies to work with on-demand talent around the world, whether through agencies or directly as independent contractors.
What is IRS form W-8
In the US, a W-8 is a tax form issued by the Internal Revenue Service (IRS) that reduces taxes for non-US individuals and entities.
There are many different types of W-8 forms with different purposes, so it’s important to review which form must be used under different circumstances. Generally, foreign freelancers and vendors who have earned income in the United States must complete W-8 forms to declare and verify their country of residence (US citizens and resident aliens do not qualify and must complete the W-9 form).
Typically, foreign companies that work in the US are required to pay a 30% tax on their earned income from a variety of sources. Foreign freelancers and vendors need to complete the form since it can exempt them from paying the full 30% tax. Their new tax rate will be determined by a variety of factors, such as the country in which they are located and their type(s) income.
How long is an IRS W-8 form valid?
The W-8 form is valid from the day it is signed to the end of the third calendar year after unless a change in circumstances makes any information on the form incorrect. For example, a Form W-8BEN signed on January 30, 2020, remains valid through December 31, 2023.
Why do I have to fill out a W-8 form in Liquid?
Liquid was built to make it easier for US companies to work with on-demand talent worldwide, whether through agencies or directly as independent contractors. Since US companies must collect a W-8 form from their overseas contractors or face stiff and severe penalties, International Vendors who use Liquid with their Clients must fill out a W-8 Form.
Is my W-8 form information secure?
Your W-8 form is secure in Liquid. Only designated users of Liquid at your Client will only be able to view this sensitive tax data.