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Browse All TopicsWhat is required when paying freelancers overseas? How do I prove to the US government that I no longer have those funds and thus should not be taxed on them.
Any other related advise would be appreciated. I will pay US freelancers too...
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by: weinberkPosted on 2009-07-03 at 13:56:49ID: 24774372
First, I'm not an expert on this. I just happened to stumble on your question. These are just opinoins. I strongly suggest consulting with a CPA.
By overseas, I assume you mean a non-US citizen working overseas?
You report the expenses on your filing. If you're doing it on a 1040, it would be on schedule C. You do not have to know tax id for the recipients, you just pool total labor expenses together on the form.
I don't believe that you'd file a 1099 for these payments since it's not being paid to a non-US entity for work being done 100% outside of the us.
IRS publication 515 (linked here) indicates that there may be the need for withholding for payments to Bulgaria, Canada, and Iceland.