W-8BEN or W-9 for a Foreign-Owned LLC: Which Form to Give

W-8BEN or W-9: which form does a foreign owner of a single-member LLC give?

The owner gives a W-8 in the owner's own name; the LLC gives no form of its own. A US LLC with one owner and no election to be taxed as a corporation is disregarded for income tax: the IRS treats it as part of its owner (IRS), and the payee of a payment to a disregarded entity is its owner (Publication 515). Form W-9 says that when that owner is a foreign person, the owner must complete a W-8 instead, even if the owner has a US tax number.

Your case is not simple if a W-9 was already given or a 1099 has arrived, if you work while in the US or the LLC has US staff or an office, if the LLC filed a classification election, or if you want a treaty rate. Gather:

• Proof of the LLC's classification: its EIN letter and any Form 8832 election.
• Your country of tax residence, your foreign tax number and any SSN or ITIN.
• What each payer pays for, and where the work is done.
• The account name and number each payer uses.
• Copies of any W-9 or W-8 already given, and any Form 1099 or 1042-S received.

W-8BEN, W-8BEN-E or W-8ECI: which W-8 do I use?

Pick by who owns the LLC and what the payment is for. A foreign individual uses W-8BEN and a foreign company uses W-8BEN-E for income not effectively connected with a US trade or business; W-8ECI replaces either one for income that is (W-8BEN instructions; W-8ECI instructions). Effectively connected income is, broadly, income from a business carried on in the US.

A payer that pays both kinds of income gets a W-8ECI for the effectively connected part and a W-8BEN or W-8BEN-E for the rest. An individual who claims exemption from withholding on pay for personal services performed in the US, for example under a treaty, gives Form 8233 or W-4 instead of a W-8, and a W-8ECI does not stop withholding on that pay (W-8BEN instructions; W-8ECI instructions).

The LLC generally does not give its own W-8BEN-E: the W-8BEN-E instructions say the foreign single owner of a disregarded entity gives the W-8, apart from narrow cases (a treaty claim by a hybrid entity, or documenting the LLC's FATCA status to a foreign bank), and a foreign owner the US treats as a partnership gives Form W-8IMY instead of W-8BEN-E. Whether your income is effectively connected is a tax question: see when foreign owners owe US tax.

Where do the LLC's name and EIN go on the W-8?

The W-8 carries the owner's name, address and tax numbers. The LLC's name goes only on a reference line, and the LLC's EIN never stands in for the owner's US tax number.

W-8BEN line 5 asks for an SSN or ITIN, not an EIN. The W-8ECI instructions say to put the LLC's details on no line other than 3 and 9 and to enter the foreign owner's US tax number; an individual running a US business as a sole proprietor can get an EIN in their own name on Form SS-4 for it. You do not need an ITIN just to give a W-8BEN: line 5 is required only in listed cases, such as certain treaty claims, and even then a foreign tax number on line 6a can serve instead (W-8BEN instructions).

To get an ITIN, see ITIN for a foreign owner. For the address lines, see US business address and bank account.

When is a W-9 with the LLC's EIN correct?

A W-9 in the LLC's own name is correct when the LLC itself is a US person: it has two or more owners and is taxed as a partnership, or it elected to be taxed as a corporation. A partnership or corporation created under US or state law is a US person (26 U.S.C. 7701), and an LLC with at least two members is a partnership unless it elects corporate treatment on Form 8832 (IRS).

Such an LLC enters its own name and EIN and checks "LLC" with P or C on line 3a (Form W-9). Where the owners live does not change this.

• A partnership with foreign partners has its own withholding and filing duties: see LLC owned by two non-residents.
• Whether to elect corporate tax: see foreign-owned LLC taxed as a corporation.
• A US owner of a one-owner LLC: see EIN for a single-member LLC.

The platform only offers a W-9 for a US business: what then?

The form follows tax status, not the state where the LLC was formed. A one-owner LLC is disregarded, so the payee is its foreign owner, and a foreign person may not give a W-9 (W-9 requester instructions). The W-8BEN instructions say a foreign individual gives a W-8BEN to a payment processor or marketplace that asks for it (W-8ECI for effectively connected income), whether or not a treaty rate is claimed. Look for the path for a foreign individual or foreign company, or ask the payer for its W-8 process; payers may collect W-8s electronically (W-8 requester instructions). If it still offers none, see marketplace payouts in a foreign-owned LLC.

A W-9 signed just to finish onboarding:

• certifies, under penalties of perjury, that the payee is a US person, and the form warns that willfully falsifying it can bring criminal penalties (Form W-9);
• leads the payer to file Form 1099-NEC or 1099-K under the LLC's EIN, instead of treating the payments as made to a foreign person;
• can bring backup withholding at 24% if the IRS tells the payer the number is incorrect, or under the other triggers in Publication 515;
• skips any withholding the payment needed. If a payer fails to withhold and the foreign person does not pay the tax, both are liable, with interest and penalties (Publication 515).

Does giving a W-8BEN mean US tax is withheld?

Not by itself. A W-8 documents foreign status; withholding at 30% applies to US-source fixed or determinable annual or periodical (FDAP) income, such as royalties, rent, interest or pay for work done in the US, that is not effectively connected with a US business (Publication 515).

No withholding does not always mean no US tax. Whether you owe tax, including on sales of goods, is covered in when foreign owners owe US tax. With no valid form at all, the payer may withhold at 30% or the backup rate (W-8BEN instructions).

Which forms will I get back: 1099-NEC, 1099-K or 1042-S?

What you get back follows the form you gave. A valid W-8 generally exempts a foreign person from Form 1099 reporting and backup withholding (Publication 515). Form 1042-S reports US-source amounts paid to foreign persons, even when nothing was withheld (1042-S instructions).

I already gave a W-9: how do I correct it?

Give each payer a correct W-8 and ask it to review what it already reported. A payer may rely on the form it holds, so the W-9 keeps driving its reporting until it is replaced (W-8 requester instructions).

1. Confirm the classification. If the LLC has two owners or a corporate election, a W-9 in the LLC's own name and EIN is the right form.
2. Sign a W-8 in your own name, with the LLC on the reference line, and submit it before the next payment.
3. Ask the payer whether it will correct 1099s already filed. The IRS information return instructions tell filers how to correct a return filed when none was required; only the payer can file that correction.
4. If backup withholding was taken, a nonresident individual claims it back on Form 1040-NR, attaching the Form 1099 that shows it (Form 1040-NR instructions); see the nonresident return for business income.
5. Keep the new form, your request, invoices and proof of where the work was done.
6. If US-source payments went out with no withholding, the tax may still be due: see when foreign owners owe US tax.

How long is a W-8BEN valid, and what needs a new one?

A W-8BEN generally stays valid from the day it is signed through the last day of the third succeeding calendar year, unless a change makes any information on it incorrect; W-8BEN-E and W-8ECI follow the same rule (W-8BEN instructions; W-8BEN-E instructions; W-8ECI instructions). After such a change, tell the payer within 30 days and give a new form. Each payer needs its own form.

A move within the same foreign country, or to another foreign country, is generally not a change, unless the form claims treaty benefits.

Example

These examples are illustrative; amounts are in US dollars.

Design fees for work done abroad

A designer living in Portugal is the only owner of a Wyoming LLC with no corporate election. A US client pays the LLC US$40,000 for work she does in Portugal. She gives the client a W-8BEN in her own name, with the LLC's name and account number on line 7. The fees are foreign-source, so the client withholds nothing, files no 1099-NEC and generally no 1042-S. The LLC's yearly filing is separate: see what a foreign-owned single-member LLC files.

A W-9 already given to a platform

• Year 1: The same designer gave a payment platform a W-9 with the LLC's name and EIN. In January she receives a Form 1099-K for US$60,000 under the EIN.
• Year 2: Before the next payout she submits a W-8BEN through the platform's tax settings and asks whether it will correct the Year 1 form. She keeps her invoices and records showing the work was done in Portugal, in case the IRS asks about the income reported under the EIN. With a valid W-8BEN, a foreign address on the account and payouts to a bank outside the US, the platform generally files no 1099-K for her.

Two founders, one partnership

Founders living in India and Brazil own a Delaware LLC together and never filed an election, so it is a partnership. The LLC is a US person: it gives clients a W-9 with its own name and EIN, checking "LLC" with P. Whether it must withhold on the founders' shares is covered in LLC owned by two non-residents.

Different for you?

• You gave a W-9, received a 1099, had backup withholding taken, or a payer offers only a W-9: unwinding it means checking the classification, the source of each payment and the payer's filings; get cross-border tax help.
• You work while in the US, or the LLC has US staff or an office: see when foreign owners owe US tax and the nonresident return for business income.
• Your LLC elected corporate tax, or you are weighing it: the LLC then gives its own W-9 and files its own return; see foreign-owned LLC taxed as a corporation or get cross-border tax help.
• You live in Canada and own the LLC yourself: the Canadian side needs its own check; see US business for a Canadian resident and get cross-border tax help.
• The LLC has two owners: see LLC owned by two non-residents.
• A Canadian corporation owns the LLC or is the payee: see W-8BEN-E for a Canadian corporation.
• A marketplace pays you, and the seller account name is in question: see marketplace payouts in a foreign-owned LLC.
• The LLC never filed its Form 5472: see missed foreign-owner filings and get cross-border tax help.
• You are moving to the US: see moving to the US with your US company.