8233 (Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual)

The 8233 is an IRS mandated form to collect correct Nonresident Alien (NRA) taxpayer information for both individuals and entities for reporting purposes and to document their status for tax reporting purpose.

WHAT IS THE FORM 8233 AND WHAT IS ITS PURPOSE? 

The 8233  is an IRS mandated form to collect correct Nonresident Alien (NRA) taxpayer information for both individuals and entities for reporting purposes and to document their status for tax reporting purpose.

Internal Revenue Code (IRC), section 1441 requires 30% income tax withholding on compensation for independent personal services.  However, some payments may be exempt from withholding because of a tax treaty. This tax is imposed on the gross amount paid and is generally collected by withholding under section 1441.

A withholding agent or payer of the income may rely on a properly completed form 8233 to treat a payment associated with the form 8233 as a payment to a foreign person who beneficially owns the amounts paid. If applicable, the withholding agent may rely on the form 8233 to apply a reduced rate of, or exemption from, withholding at source also known as a tax treaty benefit.  See applicable tax treaties at Tax Treaties for Independent Contractors and Scholarships.

HOW IS THE FORM 8233 USED?

Form 8233 is used for honorariums if tax treaty exemption applies for Independent Personal Services. To determine if tax treaty applies, refer to Tax Treaties for Independent Contractors and Scholarships. Scroll down to find the country in question, and make sure that a treaty exists for Independent Personal Services income for the particular country.

HOW OFTEN DOES THE FORM 8233  NEED TO BE OBTAINED? 

The UW policy is that a new form 8233 must be obtained for all Nonresident Alien (NRA) payments made by the UW.  Prior year 8233 forms cannot be used in subsequent years because Nonresident Alien (NRA) statuses may change from year-to-year, and even during a calendar year, therefore a new form 8233 must be obtained for all Nonresident Alien (NRA) payments made by the UW.

WHAT VERSIONS OF THE 8233 WILL THE UW ACCEPT? 

The UW will only accept current versions of any Internal Revenue Service (IRS) or Wisconsin Department of Revenue forms.  These can be found at the IRS web page at IRS Forms and the Wisconsin Department of Revenue at WI DOR Forms.

Use of a non-current form will delay payment processing because the non-current form has to be returned to the preparer and the current form must be completed before the payment can be processed in order for the UW to be in compliance with IRS and WI DOR regulations and forms.

WHERE CAN THE 8233 AND ASSOCIATED INSTRUCTIONS BE FOUND? 

W-8BEN-E (Certificate of Entities Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities))

The W-8BEN-E is an IRS mandated form to collect correct Nonresident Alien (NRA) taxpayer information for entities for reporting purposes and to document their status for tax reporting purpose.

WHAT IS THE W-8BEN-E AND WHAT IS ITS PURPOSE? 

The W-8BEN-E is an IRS mandated form to collect correct Nonresident Alien (NRA) taxpayer information for entities for reporting purposes and to document their status for tax reporting purpose.

In addition, the W-8BEN-E is a required document when making Non-U.S. Source Income payments to a Nonresident Alien (NRA) which are payments when the services performed are (1) performed by a Nonresident Alien (NRA), and (2) are performed outside the United States.  For details on Non-U.S. Source Income payments please refer to Non-U.S. Source Income (Payments to Non-Resident Aliens for work performed Outside the U.S.)

Nonresident Aliens 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))
  • Dividends
  • Rents
  • Royalties
  • Premiums
  • Annuities
  • Compensation for, or in expectation of, services performed
  • Substitute payments in a securities lending transaction
  • 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.  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.

A withholding agent or payer of the income may rely on a properly completed W-8BEN-E to treat a payment associated with the W-8BEN-E as a payment to a foreign person who beneficially owns the amounts paid.  If applicable, the withholding agent may rely on the W-8BEN-E to apply a reduced rate of, or exemption from, withholding at source also known as a tax treaty benefit.  See applicable tax treaties at Tax Treaties for Independent Contractors and Scholarships.

HOW IS THE W-8BEN-E USED?

Effective January 1, 2010 the Form W-8BEN has two uses at the UW:

  1. A completed and signed W-8BEN-E is required for all tax reportable transactions made to a Nonresident Alien (NRA) of the United States.  This includes all payment mechanisms used at the UW. The W-8BEN-E is the equivalent of the W-9 for used for U.S. Persons.  Tax reportable payment and associated Account Codes are posted at 1099-MISC and 1042-S Tax Reportable Payments.
  2. Use Form W-8BEN-E for Scholarship/Fellowship Grants if a tax treaty exemption applies. The treaty must include a provision for Scholarship/Fellowship Grants. To determine if the tax treaty applies refer to Tax Treaties for Independent Contractors and Scholarships.

HOW OFTEN DOES THE W-8BEN-E NEED TO BE OBTAINED? 

The UW policy is that a new W-8BEN-E must be obtained for all Nonresident Alien (NRA) payments made by the UW.  Prior year W-8BEN-E forms cannot be used in subsequent years because Nonresident Alien (NRA) statuses may change from year-to-year, and even during a calendar year, therefore a new W-8BEN-E must be obtained for all Nonresident Alien (NRA) payments made by the UW.

WHAT VERSIONS OF THE W-8BEN-E WILL THE UW ACCEPT? 

The UW will only accept current versions of any Internal Revenue Service (IRS) or Wisconsin Department of Revenue forms.  These can be found at the IRS web page at IRS Forms and the Wisconsin Department of Revenue at WI DOR Forms.

Use of a non-current form will delay payment processing because the non-current form has to be returned to the preparer and the current form must be completed before the payment can be processed in order for the UW to be in compliance with IRS and WI DOR regulations and forms.

WHERE CAN THE W-8BEN-E AND ASSOCIATED INSTRUCTIONS BE FOUND? 

W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals))

The W-8BEN is an IRS mandated form to collect correct Nonresident Alien (NRA) taxpayer information for individuals for reporting purposes and to document their status for tax reporting purpose.

WHAT IS THE W-8BEN AND WHAT IS ITS PURPOSE? 

The W-8BEN is an IRS mandated form to collect correct Nonresident Alien (NRA) taxpayer information for individuals for reporting purposes and to document their status for tax reporting purpose.

In addition, the W-8BEN is a required document when making Non-U.S. Source Income payments to a Nonresident Alien (NRA) which are payments when the services performed are (1) performed by a Nonresident Alien (NRA), and (2) are performed outside the United States.  For details on Non-U.S. Source Income payments please refer to Non-U.S. Source Income (Payments to Non-Resident Aliens for work performed Outside the U.S.)

Nonresident Aliens 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))
  • Dividends
  • Rents
  • Royalties
  • Premiums
  • Annuities
  • Compensation for, or in expectation of, services performed
  • Substitute payments in a securities lending transaction
  • 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.  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.

A withholding agent or payer of the income may rely on a properly completed W-8BEN to treat a payment associated with the W-8BEN as a payment to a foreign person who beneficially owns the amounts paid.  If applicable, the withholding agent may rely on the W-8BEN to apply a reduced rate of, or exemption from, withholding at source also known as a tax treaty benefit.  See applicable tax treaties at Tax Treaties for Independent Contractors and Scholarships.

HOW IS THE W-8BEN USED?

Effective January 1, 2010 the Form W-8BEN has two uses at the UW:

  1. A completed and signed W-8BEN is required for all tax reportable transactions made to a Nonresident Alien (NRA) of the United States.  This includes all payment mechanisms used at the UW. The W-8BEN is the equivalent of the W-9 for used for U.S. Persons.  Tax reportable payment and associated Account Codes are posted at 1099-MISC and 1042-S Tax Reportable Payments.
  2. Use Form W-8BEN for Scholarship/Fellowship Grants if a tax treaty exemption applies. The treaty must include a provision for Scholarship/Fellowship Grants. To determine if the tax treaty applies refer to Tax Treaties for Independent Contractors and Scholarships.

HOW OFTEN DOES THE W-8BEN NEED TO BE OBTAINED? 

The UW policy is that a new W-8BEN must be obtained for all Nonresident Alien (NRA) payments made by the UW.  Prior year W-8BEN forms cannot be used in subsequent years because Nonresident Alien (NRA) statuses may change from year-to-year, and even during a calendar year, therefore a new W-8BEN must be obtained for all Nonresident Alien (NRA) payments made by the UW.

WHAT VERSIONS OF THE W-8BEN WILL THE UW ACCEPT? 

The UW will only accept current versions of any Internal Revenue Service (IRS) or Wisconsin Department of Revenue forms.  These can be found at the IRS web page at IRS Forms and the Wisconsin Department of Revenue at WI DOR Forms.

Use of a non-current form will delay payment processing because the non-current form has to be returned to the preparer and the current form must be completed before the payment can be processed in order for the UW to be in compliance with IRS and WI DOR regulations and forms.

WHERE CAN THE W-8BEN AND ASSOCIATED INSTRUCTIONS BE FOUND? 

W-9 (Request for Taxpayer Identification Number and Certification)

The W-9 is an Internal Revenue Service (IRS) form in which a taxpayer provides their correct taxpayer identification number (TIN) to an individual or entity (Form W-9 requester) who is required to file an information return to report the amount paid to a payee, or other amount reportable on an information return.

Download W-9 Form

WHAT IS THE W-9 AND WHAT IS ITS PURPOSE? 

The W-9 is an Internal Revenue Service (IRS) form in which a taxpayer provides their correct taxpayer identification number (TIN) to an individual or entity (Form W-9 requester) who is required to file an information return to report the amount paid to a payee, or other amount reportable on an information return.  A TIN may be a social security number (SSN), individual taxpayer identification number (ITIN), adoption taxpayer identification number (ATIN), or federal employer identification number (EIN/FEIN/FEIN/FEIN).

The UW requires the form W-9 for all tax reportable transactions as of January 1, 2010.

Implementation of the W-9 reporting process (January 1, 2010):

  1. The UW needed to have a signed legal document on file to support and document the tax information when it makes a tax reportable payment. The required document is the IRS W-9 form.  The W-9 captures all the required tax information for tax reporting. This includes (1) name, (2) business name, (3) type of entity, (3) exempt status, (4) address, (5) taxpayer identification number, and (6) signature.
  2. Effective January 1, 2010 the UW requires a completed and signed form W-9 (or W-8BEN for Nonresident Aliens (NRA) be attached to all tax reportable payments made through all payment mechanisms (PIR/DP/PO, etc.).  Tax reportable payments and associated Account Codes are posted at 1099-MISC and 1042-S Tax Reportable Payments.
  3. As of Monday (August 9, 2010) Business Services has incorporated the W-9 indicator field in the WISDM Vendor Search.  When processing tax reportable payments through any UW payment mechanism please check the WISDM Vendor Search to determine if a W-9 (or W-8 BEN for Nonresident Aliens (NRA)) is on file at Business Services.  If a W-9 is on file you will not need to include a W-9 with your payment requests. If a W-9 is not on file you will need to include a W-9 with your first payment request to a vendor so that the vendor can be set up at Accounting Services and the Taxpayer Identification Number (TIN) can be verified with the IRS TIN Matching Program.  For tax reportable transactions, if a W-9 is not on file per the WISDM Vendor Search and you do not include the W-9 with your payment requests, Business Services will put your payment request on hold and inform you that you need to get a W-9 before the payment is released for processing.

Download – How To Use Vendor Search in WISDM for SFS AP Transactions

HOW IS THE W-9 USED?

The form W-9 is required by an individual or entity (Form W-9 requester) who is required to file an information return with the IRS and must obtain the payee’s correct taxpayer identification number (TIN) to report on an information return the amount paid to a payee, or other amount reportable on an information return.  A TIN may be a social security number (SSN), individual taxpayer identification number (ITIN), adoption taxpayer identification number (ATIN), or employer identification number (EIN/FEIN).

WHO CAN SIGN A W-9

The person who signs a W-9 must be a U.S. person.  That means that the signer must be an individual who is a U.S. citizen or a U.S. resident alien.  The signer should have the organization’s consent to sign a W-9 on its behalf.

IRS Form W-9 is most commonly used by individuals when they are working as a freelancer or independent contractor. If you ever find yourself filling out a Form W-9, it generally means that a business or person who is paying you money needs your U.S. Taxpayer Identification nUmber (TIN) which can be either the U.S. Social Security Number (SSN), Individual Taxpayer Identification Number (ITIN), Federal Employer Identification Number (EIN/FEIN) so it can notify the IRS of the amount.

Minors: In the case of a Minor the W-9 should be completed with the minor’s name and the minor’s Taxpayer Identification Number (TIN) since they are the owners of the payment being made.  As to the signature it can be either the minor’s signature or the legal guardian (parent or court appointed legal guardian).   If you look on the internet a minor cannot sign a contract but the W-9 is not a contract and is just giving the name and TIN of the minor therefore a legal guardian is not required, but is only encouraged.

IS A DIGITAL OR ELECTRONIC SIGNATURE ACCEPTABLE ON A W-9

No.  The IRS requires a regular (non-digital) signature since the W-9 is a legal document.  Some paying entities accept electronic signatures but the UW’s secured system where we scan and archive the W-9 only takes a scan of the documents and cannot at this time capture the electronic signature details attached to that signature on the W-9.

HOW OFTEN DOES THE W-9 NEED TO BE OBTAINED? 

Form W-9 remains valid unless a change in circumstances makes any information on the form incorrect.  For example, a change in name or a change in type of entity. Please note that a change in address does not require a new W-9.

WHAT VERSIONS OF THE W-9 WILL THE UW ACCEPT? 

The UW will only accept current versions of any Internal Revenue Service (IRS) or Wisconsin Department of Revenue forms.  These can be found at the IRS web page at IRS Forms and the Wisconsin Department of Revenue at WI Department of Revenue (DOR) Forms.

Use of a non-current form will delay payment processing because the non-current form has to be returned to the preparer and the current form must be completed before the payment can be processed in order for the UW to be in compliance with IRS and WI DOR regulations and forms.

WHERE CAN THE W-9 AND ASSOCIATED INSTRUCTIONS BE FOUND? 

 

Payment to Individual Report

The Payment to Individual Report (PIR) is used to request all payments to individual non-employees.

Use this form to to request all payments to individual non-employees.


Download Payment to Individual Report (xlsm)

Instructions

Vendor #: Each vendor or individual will be added to our SFS Accounting System Vendor File and be assigned a vendor number. For Accounting Services use only, leave blank.

Voucher #: Each payment made in the SFS Accounting System will be assigned a voucher number. For Accounting Services use only, leave blank.

Payee name: The full, legal name of the payee (last name, first name, middle initial).

Amount: Enter the total amount to be paid to the individual before any applicable tax withholding.

Funding Information:  Enter the specific funding information to which the payment is to be charged. This includes Account, Fund, DeptID, Program, Class (Bldg #), Budget Year, and Project.

Taxpayer ID# (SSN, EIN, ITIN): The Social Security Number (SSN), Employer Identification Number (EIN), or Individual Taxpayer Identification Number (ITIN).

Enter the individual’s social security number or individual taxpayer identification number (ITIN), if any. This is the tax identification number under which any reportable payments will be reported to tax authorities. Accuracy is extremely important. Taxes must be withheld from reportable payments if a social security number or ITIN is not provided.

An individual who is a nonresident alien and does not have a social security number or ITIN, should apply for a social security number, if eligible, or for an ITIN, if not eligible for a social security number. After application has been made, enter “applied for” in this space, and see Accounting Services Policy and Procedure Manual on Tax Reporting and Withholding on Non-Salary Payments.

Invoice #: Leading characters PIR plus the date of service, complete as PIRMMDDYY. Where there is an attached invoice, PIR plus the invoice number should be used.

Payment Handling Code: Determines how the check will be routed. For Accounting Services use only, leave blank.

Mail To Address: Enter the address to which the check should be mailed or special handling instructions (i.e., call for pickup, campus mail, etc.). If the check is to be picked up, enter “please call (name) at (x-xxxx) when check is ready.

Permanent Home Address: Enter the individual’s permanent mailing address if different from the “Mail Check To” address. This is the address to which a tax form will be mailed at the end of the calendar year.
If State Employee indicate Agency/Dept: If paying an employee from another state agency or department, please agency and/or department.
Currently Enrolled UW Student: Is the payee a student currently enrolled at a UW Institution? Check yes or no.

Residency: If the payee is a legal United States resident or a resident of another country, check appropriate box. If resident of another country please enter the country name and VISA type in the space provided.

It is very important that the country of RESIDENCE be entered, which is not necessarily the country of CITIZENSHIP. Please follow the How-To flowchart, Which Tax Related Documents Are Required When Making Payments, to determine the tax related documents that must be obtained in order to process payments. Accuracy is a must in order to be in compliance with Internal Revenue Service (IRS) reporting requirements. Payments to nonresidents of the U.S. require various forms of visa documentation. There are tax considerations as well. For further information and instructions, refer to Accounting Services Policy and Procedure Manual on Tax Reporting and Withholding on Non-Salary Payments and UW-Madison instructions for Payments to Foreign Nationals.

1099-MISC/1042S Tax Reportable Payment: Select Yes, No, or Not Sure.

Please use the 1099-MISC/1042S Tax Reportable Transactions document (pdf) to determine whether a transaction you are processing needs to be reported to the payee for tax purposes. All transactions listed in the column labeled “1099-MISC/1042S REPORTABLE TRANSACTIONS INCLUDED IN THIS CODE” must be marked/checked as reportable on the processing form you are submitting (PIR, etc.).

If you are not sure please check the appropriate box on the form and Accounting Services will make the determination. Accuracy is a must in order to be in compliance with Internal Revenue Service (IRS) reporting requirements.

Date(s) of Service: Enter the exact dates during which service was/will be provided.

Purpose of Payment: Describe the purpose of payment. Use e-Reimbursement for travel and expense reimbursements as outlined in Policy 203-Payment for Services and Travel and Expense Reimbursement for Non-employees.

For more information, call: Indicate the name and phone number of a person to contact if there are questions regarding the payment request.

Add additional contact information from the Dean’s Office to be contacted instead of the individual listed on the DP/PIR form. Add the contact’s name and phone number directly under the departmental contact person.

Accounts Payable will only contact the person indicated from the Dean’s Office as responsible for supplying additional information; not both. If Accounts Payable receives a form without an additional Dean’s Office contact name, the contact person indicated on the form will be the only one contacted.

Business Office Use Only: Where taxes are calculated. For Accounting Services use only, leave blank.

Entertainer/Public Speaker Section: Complete this section if the payee is an entertainer or public speaker.

Attach a completed, signed entertainment contract. Only UW Purchasing can sign contracts for the University unless the Department has been delegated by Purchasing to sign contracts. Payment may be subject to withholding if the entertainer or public speaker is not a Wisconsin resident.

If the payee is an entertainer or public speaker and is a non Wisconsin-resident then a completed Department of Revenue (DOR) Form WT-11 must be attached to the PIR. See Accounting Services Policy and Procedure Manual on Tax Reporting and Withholding on Non-Salary Payments for complete instructions regarding the Wisconsin Entertainer Tax.

Federal Tax Calculation: For Accounting Services use only, leave blank

Scholarship/Fellowship Section: If the payment is for a scholarship or fellowship to a UW student, separately enter the portions of this payment which apply to Semester 1, Semester 2, and Summer Session. Enter the award date (date the student was notified of the award.)

Approving Signatures And Dates: Before payments can be processed all signatures and dates must be on the PIR (Department Chairperson/Project Director, Dean/Director, Student Financial Aids if expense is charged to Activity 9, and Authorized Institutional Approval (Pre-Audit). If the payment is for a scholarship/fellowship on activity 9, the form will be forwarded by the Dean’s office to the Office of Student Financial Aids.

Submitting the form: Print and submit one copy of the form to Accounting Services, Suite 5301, 21 N. Park Street. Photocopy original receipts that are not 8 ½ by 11 and attach the photocopy to the PIR instead of the original. The Department keeps the original receipt as a back up for 90 days and then destroys it.

Forms Help: Red triangles in various fields of the form contain comments designed to help you complete the form. Also, some form text is hyper linked to web information that will assist you in completing the form. Questions regarding this form should be e-mailed to uwtravel@bussvc.wisc.edu.

Printing Your Form: There are many versions of Excel on campus. The forms have been developed to print on one page. If you are having problems printing, use the Excel tool bar, select File, then Page Set Up. This will open a dialog box for you to select “Fit to 1 page”. If this solution does not work, please contact your IT support person for further assistance.
Questions regarding this form should be e-mailed to acctg@bussvc.wisc.edu.