I don't understand the term "backup withholding" on the tax forms. I need to know whether to check the "exempt" box or not, etc. Thanks in advance!
2007-03-20 15:46:18 · 3 answers · asked by makeupalleygirl 1 in Business & Finance ➔ Taxes ➔ United States
unless you have been informed by the IRS that you are subject to backup withholding you are exempt.
2007-03-20 15:53:41 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Backup withholding is when they believe you will owe extra tax - like on bonuses or interest. Some employers will use backup withholding if they question social security numbers while they verify them.
Mostly all employees are exempt.
Most investments are not exempt.
2007-03-20 16:30:05 · answer #2 · answered by Wolfpacker 6 · 0⤊ 1⤋
Backup withholding is a useless ringer for W-2 withholding. The payer holds out the money and sends it to the irs. once you record, you connect a replica of the 1099 that shows the withholding so that you get credit for it. once you get your call corrected, more beneficial withholding stops.
2016-12-02 08:10:59 · answer #3 · answered by mayze 3 · 0⤊ 0⤋