The district has the responsibility to withhold the 30% from the payment, deposit the withholding with the IRS, and provide annual reporting documents (Form 1042-S) to both the foreign vendor and the IRS. The State of California also has withholding requirements of 7%.
- W-8 Form is required rather than a W-9 Form
- 1042-S Form is required rather than a 1099 Form
All Foreign Vendor Purchase Orders will begin with “FR.”
This will assist in identifying Purchase orders in which a Foreign Vendor has been used.
Additional Resources regarding this topic can be found at: https://www.irs.gov/faqs/faq13.html