Hi, I’m CPA Maximiliano Mira Salas, international tax advisor.
Today we analyze a key topic for foreign owners of U.S. LLCs: when to use Form W-8BEN or Form W-9, depending on your entity’s structure and its tax classification with the IRS.
🧾 In brief
Whenever a U.S. entity or client pays you, they will request a tax identification certification. If you have a U.S. LLC with foreign owners, you must submit either a W-8BEN or a W-9, depending on how your LLC is classified for U.S. federal tax purposes.
Key differences:
W-8BEN
Applies when your LLC has a single foreign owner. For federal tax purposes, this structure is treated as a disregarded entity under Treas. Reg. §§ 301.7701-3(b)(1)(ii) and 301.7701-2(c)(2)(iii).
This means the LLC exists legally, can open bank accounts and operate, but is disregarded for tax purposes and the reporting obligation falls directly on the individual foreign owner. Therefore, the W-8BEN is completed using the owner’s information, not the LLC’s.
W-9
Must be submitted when the LLC has more than one member (multimember) or has elected to be taxed as a corporation (C-Corp) or partnership. In this case, the entity is treated as a U.S. person under Treas. Reg. § 301.7701-5(a) and may complete the W-9 using its own EIN to receive payments without withholding.
In summary:
- Single-member foreign-owned LLC → W-8BEN (in the owner’s name)
- Multimember LLC or C-Corp → W-9 (in the entity’s name)
Submitting the incorrect form may result in 30% withholding or banking delays.
Common mistakes:
🚫 Submitting a W-9 as a foreign single-member LLC
🚫 Omitting a valid ITIN or EIN
🚫 Failing to update forms after changes in structure or tax residency
Verify which form applies to your LLC and make sure it is kept up to date with your clients or banks. An early review helps avoid unnecessary withholding and facilitates IRS compliance.
At FINANCERS, we provide a practical guide to correctly complete the W-8BEN or W-9 based on your LLC type and tax situation.
📩 Contact us and we’ll send you, at no cost, the appropriate form along with step-by-step instructions to complete it correctly.
