Tax Information

An IRS Form 1099 is issued to an individual, sole proprietorship, partnership, medical (for services) or legal corporation when total 1099 reportable payments in a calendar year exceeds $600.

The portion of a payment associated with service performed inside of the U.S. by a nonresident alien (non-U.S. citizen) is subject to federal and state tax reporting.

• An IRS Form 1042-S is issued to a foreign individual or company when paid compensation payments (i.e. honoraria, fellowship/scholarship, independent personal services) in a calendar year.

Payments to California non-residents who come to California to perform services are subject to California State tax withholding at the rate of 7% if the gross payment is over $1,500 per calendar year (FTB Pub 1017).

Withholding can only be waived or reduced by the Franchise Tax Board – federal income tax treaties do not apply to state tax.

• CA Form 588 Nonresident Withholding Waiver Request
• CA Form 589 Nonresident Reduced Withholding Request
• CA Form 590 Withholding Exemption Certificate

For more information please review the Tax Information Chart