Form W-8EXP is filled out by foreign governments, foundations, and tax-exempt organizations to claim a reduction or exclusion of federal income tax withholding. The same as other types of Forms W-8, it is then forwarded to the payer or the withholding agent. If Form W-8EXP isn’t sent to the payer or the withholding agent, it can result in backup withholding or other types of withholding for federal income tax purposes for up to 30 percent in total.
While Form W-8EXP is quite easy to fill out, the filer must be eligible for reduction or exemption from federal income tax withholding under IRS code 115(2), 501(c), 892, 895, or 1443(b). If the filer isn’t eligible for exclusion or exemption, W-8BEN or W-8ECI if earned/received effectively connected income.
Form W-8EXP is made up of four different parts. In the first three sections, everything related to the tax status and the identification of the beneficial owner will be reported.
Part 1 – Identification of Beneficial Owner
Identify the type of entity and Chapter 4 status. Check the boxes that correspond to the foreign government, foundation, or tax-exempt organization. From Lines 5 through 9, enter address, mailing address, TIN, GIIN, and reference number(s).
Part 2 – Qualification Statement for Chapter 3 Status
Fill out the part according to the type of organization you are (foreign government, foreign foundation, etc.). This part determines the qualification for Chapter 3 status.
Part 3 – Qualification Statement for Chapter 4 Status
Do the same as above, but for Chapter 3 status. If you don’t know whether or not the foreign government/organization/foundation/ you’re filing Form W-8EXP on behalf of qualify for the Chapter 3 or 4 status, speak to a tax preparer to help you guide on this.
Part 4 – Certification
This is the part where you sign and certify that every information entered on the form is correct, best to your knowledge.