Commission Collection for Events Outside the U.S.
We recently came across a tax documentation requirement while collecting commissions from a vendor outside the U.S., and we wanted to share the information in case it’s helpful to others working on international transactions.
This was a new process for us, and it may be relevant to those of you expecting income from clients, partners, or business activities abroad. Specifically, the IRS requires Form 6166, which serves as a Certificate of U.S. Tax Residency and is issued upon filing Form 8802.
Obtaining this documentation in advance can help avoid delays in commission payments and ensure you're able to take advantage of relevant tax treaty benefits. Here’s why it’s important:
Confirms your status as a U.S. tax resident to foreign tax authorities
Allows you to claim benefits under tax treaties between the U.S. and other countries
Can help reduce or eliminate foreign withholding taxes
Supports U.S.-based individuals and businesses in avoiding double taxation on foreign-sourced income
Required for a range of income types, including commissions, freelance work, investments, and service fees
The approval process for Form 6166 can take several weeks, so it’s best to start early if you anticipate needing it. For more detailed information and instructions on how to apply, you can visit the IRS links below:
We hope this is helpful and saves you time should a similar situation arise.
IRS Form 6166: What It Is, Why You Need It & How to Apply
Form 6166 – Certification of U.S. tax residency | Internal Revenue Service
IRS Form 8802 – Application for U.S. Residency Certification
