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How to Configure Tax Forms
How to Configure Tax Forms
Settings for Tax Compliances
Tim Nixon avatar
Written by Tim Nixon
Updated over a week ago

If you have our tax feature enabled on your account, you can configure it to gather the information you require from your recipients. We suggest the "recommended" settings under these options.

Please note, we are not authorized to provide tax advice. We recommend speaking with a tax professional to determine the best settings for your account.

First, go to Settings, then Tax Compliance

Here you can select which Tax form(s) you will require, set the income type(s), as well as indicate how you want to handle Tax form approvals and rules when issuing payments to recipients.

Step 1

Click on Enable

Enter a support email your recipients can use if they need assistance filling out the form.

Select the income type(s) that best describes the purpose of the payment, either Royalties/Copyrights or Independent personal Services for the types of your recipients.

Form Types
W-9: form required by US entities and persons.
W-8BEN: form required by non-US persons.
W-8BEN-E: form required by non-US entities.

Step 2

Specify the forms you would like to collect. There are 2 options:

W-9, W-8BEN and W-8BEN-E Forms: Select this option if you have both US and international recipients. When filling out their information on the widget or portal, recipients will be asked to select the appropriate form for their circumstances.

W-9 Forms (US Only): Select this option if all your recipients are US persons. The W-9 form will appear automatically to all recipients.

Step 3

Select whether or not you would like to manually approve each submitted tax form before any withholding is applied, or have forms approved automatically and withholding applied once submitted.

Manually reviewing prevents the overlooked withholding applied and Automatically approving would make it easier to make payouts but likely they will need to be looked at by you after the payout is made if there's a discrepancy on the payment.

Step 4

This step allows you to select how you would like to manage recipients without a tax form on file. The options are:

Tax Form Required: All recipients without a tax form will be marked as incomplete, and will not be able to receive payments.

Apply Default Withholding:

YES: You will receive a warning that a selected recipient does not have a tax form on file before the payment is submitted. You will then decide whether or not you wish to send the payment. (Note: recipients without a tax form will still appear as active. There will be no warning if the payment is sent through API)

NO: Tax Form Not Required: Recipients without a tax form will still be able to receive payments.

Backup Withholding options:

W-9 Forms

W-9 Forms have exceptions whereas if the recipient does not fill out the form correctly, 24.0% Backup Withholding will be applied.

If you select "No Backup Withholding" and the recipient inputs a valid TIN number
and do not select the check box on the W-9 form, backup withholding will be applied.

See the screenshot below for more details.

W8BEN, W8BEN-E Forms

For all non-US persons we have the option to force certification of non-US activities. This feature is enabled upon request.

Tax Form Status

After a Tax Form submission is initiated by a recipient, the Tax Form will appear in the Recipient's Trolley Profile (in the Tax Forms tab), as well as in the Tax Forms section of your Tax Center. Each Tax Form will have one of the following statuses:

Incomplete - The Tax Form was started by the recipient, but not completed.
Submitted - The Tax Form was completed by the recipient and is awaiting review from a Trolley user. This step is skipped if the tax form is automatically reviewed due to merchant tax settings.
Reviewed - The Tax Form has been reviewed will be used as the primary tax form associated to any payments made to this recipient.
Voided - The tax form was set to void. This can either be caused by the submission of a new tax form by the recipient or via a Trolley user manually voiding the tax form.
Expired - For W8 Forms only. W8s expire every 3 years and will be set to Expired status automatically by the Trolley system.

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