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Important
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For information call now:
(347) 989-4566
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Additional information
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Internal Revenue Service
Austin Service Center
ITIN Operation
P.O. Box 149342
Austin, TX 78714-9342
IN
1-800-829-1040
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Tax Withheld on Partnership Income
If you are a foreign partner in a U.S. or foreign partnership, the partnership
will withhold tax on your share of effectively connected taxable income (ECTI)
from the partnership. You may be able to reduce your ECTI subject to withholding
by certain partner-level deductions. Generally, you must use Form 8804-C for
this purpose.
The withholding rate on your share of effectively connected income is generally
the highest rate of tax that applies to you (35% for 2011). However, the
partnership may withhold at the highest rate that applies to a particular type
of income allocable to you if you gave the partnership the appropriate
documentation (generally, Form W-8BEN). Long-term capital gain is an example of
a particular type of income to which the highest tax rate applies. Claim the tax
withheld as a credit on your 2011 Form 1040NR.
The partnership will give you a statement on Form 8805, Foreign Partner�s
Information Statement of Section 1446 Withholding Tax, showing the tax withheld.
A partnership that is publicly traded will withhold tax on your actual
distributions of effectively connected income. In this case the partnership will
give you a statement on Form 1042-S, Foreign Person�s U.S. Source Income Subject
to Withholding.
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