MicrostockGroup
Agency Based Discussion => Adobe Stock => Topic started by: cidepix on January 05, 2010, 08:56
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What they are doing is clearly illegal.
I submitted the W8-BEN form and I still get my US sales income deducted. When we have examples like shutterstock and veer it is pretty easy to make a valid case.
Plus I read they are deducting %30 from all the sales if you have not submitted the form. Wait a minute? Even if you don't submit the form they can not withold money on for example Germany sales? Or any other countries!
This is clearly ILLEGAL, dodgy business!
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There was confusion caused obviously by unbelievable lack of communication and confusing info in messages that got out, yet it seems that the fact is that:
- They have been deducting 30% from US sales for people that submitted the form without ITIN
- They have been deducting 28% from all sales for people that did not submitted the form
+ Likely those that submitted the form with ITIN get the appropriate deduction according to the treaties (although I've not heard that from anyone, I would assume that the really big players put their acts together, probably also because they already had the ITIN)
Is this illegal? I would consult layer first. The 30% deducted is clearly the witholding rate for non-treaty countries. Searching for whether ITIN is required or not on IRS site, I have mixed impression. Is it 100% that SS has it right? No.
The 28% is supposed to be some sort of US income tax. Is income of non-US person made through sale to non-US customer through US based agent supposed to get taxed like that? One would think that it would be illogical. Yet we all know tax laws tend to be illogical at spots.
What I'm trying to say here is that it is not clear whether this whole thing is illegal (partially). One thing is clear - this is by far the most poorly handled action of any agency or employer I've experienced so far.
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The problem is that
A) ITIN isn't easy to obtain
B) Several other agencies (SS, BS, Veer to name a few) are accepting W-8BEN without ITIN, and they don't deduct 30% for contributors from treaty countries
Initially SS insisted on having ITIN number, but after several consultations with their lawyers they accepted the form without ITIN.
This is what Veer said last year:
>Good news! As long as you are the Rights Holder and from a treaty country –
>
> you do NOT need a US Taxpayer Identification Number to claim treaty benefits.
> Sweet!
>
> If you are from a treaty country and you are NOT the Rights Holder, you will
> need a US Taxpayer Identification Number (US TIN) to receive treaty benefits.
>
> Even if you are from a non-treaty country, as long as you are the Rights
> Holder you also do not need a US Taxpayer Identification Number.
However I don't have a formal legal reference for that statement :(
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However I don't have a formal legal reference for that statement :(
Yes, and that's the problem. I've not seen anyone citing any actual legal reference for that statement.
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a good point is made in the neighbor thread - if Fotolia persists on ITIN they will have to male paper letters to everyone; and this wouldn't be cheap when multiplied thousands times.
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a good point is made in the neighbor thread - if Fotolia persists on ITIN they will have to male paper letters to everyone; and this wouldn't be cheap when multiplied thousands times.
Actually, as I posted in the other thread, they seem to send it as PDF with 'hand written' signature. Easy to automate. Long term costs close to 0.
Here is the post from FT forum (http://www.fotolia.com/forum/viewtopic.php?id=24454 (http://www.fotolia.com/forum/viewtopic.php?id=24454)):
All you need to do, Denis, is contact customer support in the US and request the letter; they will send you a PDF with a hand-written signature. Like Mat said, you need to contact CS, not post it here on the forum.
thanks,
Daniela
Director, Fotolia United Kingdom
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In the US I was asked to submit form w-9. I submitted on the first and it still isn't approved yet.
Does nobody any good to submit forms and then not have them reviewed.
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In the US I was asked to submit form w-9. I submitted on the first and it still isn't approved yet.
Does nobody any good to submit forms and then not have them reviewed.
Strange! i filled in my W-8 on the 2nd and it was validated a couple of hours later. Maybe another glitch in their whole 'taxing system"?
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In the US I was asked to submit form w-9. I submitted on the first and it still isn't approved yet.
Does nobody any good to submit forms and then not have them reviewed.
Same here, Lisa. I submitted the w-9 on the second and it still hasn't be reviewed. I've stopped uploading for the time being, until we find out what's going on. This is outrageous.
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Looks like maybe they have their hands full inspecting the W-8s and the W-9s are gathering dust... ???
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I submitted my W9 in Dec soon after they made that annoucement and they validated it the next day. I am a US resident. I have also requested payment via paypal and that came through fine since with 0% withholding, guess I am the lucky few.
If you are so unlucky as to have 28%-30% withheld because you are not a US resident/no ITIN no/did not submit W8, depending on yr country's tax treaty laws with the US, you should be able to get some relief from having to pay that tax twice, by that I mean be given a credit against your tax liability (if you include yr stock photography income when filing tax return in your own country). I am a tax preparer by profession but I am not an expert and definitely not in the area of foreign tax treaty laws. Best to consult your own tax professional/CPAs/Attorneys in yr country.
JC
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In the US I was asked to submit form w-9. I submitted on the first and it still isn't approved yet.
Does nobody any good to submit forms and then not have them reviewed.
I submitted my W-9 on 01/01 as well and it is still pending approval.
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I submitted my W-9 yesterday and it got approved today.
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My first W9 was rejected. Second one, no change was accepted quickly. It's Fotolia, what would you expect?
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a good point is made in the neighbor thread - if Fotolia persists on ITIN they will have to male paper letters to everyone; and this wouldn't be cheap when multiplied thousands times.
Actually, as I posted in the other thread, they seem to send it as PDF with 'hand written' signature. Easy to automate. Long term costs close to 0.
Here is the post from FT forum ([url]http://www.fotolia.com/forum/viewtopic.php?id=24454[/url] ([url]http://www.fotolia.com/forum/viewtopic.php?id=24454[/url])):
All you need to do, Denis, is contact customer support in the US and request the letter; they will send you a PDF with a hand-written signature. Like Mat said, you need to contact CS, not post it here on the forum.
thanks,
Daniela
Director, Fotolia United Kingdom
The above mention thread has changed. Daniela is checking to see if a PDF file is acceptable with the IRS. Until then we are to request the W7 letter by mail.
(http://www.fotolia.com/forum/viewtopic.php?id=24454 (http://www.fotolia.com/forum/viewtopic.php?id=24454)):
Denis
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Every W9 I have filled out at stock sites except for FT was a PDF File.
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I need to ask Fotolia that once the forms have been reviewed and approved will sales be credited appropriately that were made while the form was pending in their queue?
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The above mention thread has changed. Daniela is checking to see if a PDF file is acceptable with the IRS. Until then we are to request the W7 letter by mail.
([url]http://www.fotolia.com/forum/viewtopic.php?id=24454[/url] ([url]http://www.fotolia.com/forum/viewtopic.php?id=24454[/url])):
Denis
The Three Stooges are running the legal department?
If you go to the IRS site and download any US tax forms, they are all PDF files!
Like this one, W-9 download, note the site is IRS GOV http://www.irs.gov/pub/irs-pdf/fw9.pdf (http://www.irs.gov/pub/irs-pdf/fw9.pdf)
W-7 Here: http://www.irs.gov/pub/irs-pdf/fw7.pdf (http://www.irs.gov/pub/irs-pdf/fw7.pdf)
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In the US I was asked to submit form w-9. I submitted on the first and it still isn't approved yet.
Does nobody any good to submit forms and then not have them reviewed.
I submitted my W-9 on 01/01 as well and it is still pending approval.
Same here, submitted on 1/1/2010, as soon as I received the email.... still PENDING!
I'm really pissed because I have a legal business in the US, and I'm already paying taxes to the IRS on all my earnings.
So now I'm being DOUBLE taxed!!!
And to make it worse Fotolia support said that they won't reimburse any of the already deducted taxes (%30) because it's already gone to the IRS.
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I need to ask Fotolia that once the forms have been reviewed and approved will sales be credited appropriately that were made while the form was pending in their queue?
I already asked them and they replied no, because according to them the money goes directly to the IRS and there will be NO refund.
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The above mention thread has changed. Daniela is checking to see if a PDF file is acceptable with the IRS. Until then we are to request the W7 letter by mail.
([url]http://www.fotolia.com/forum/viewtopic.php?id=24454[/url] ([url]http://www.fotolia.com/forum/viewtopic.php?id=24454[/url])):
Denis
The Three Stooges are running the legal department?
If you go to the IRS site and download any US tax forms, they are all PDF files!
Like this one, W-9 download, note the site is IRS GOV [url]http://www.irs.gov/pub/irs-pdf/fw9.pdf[/url] ([url]http://www.irs.gov/pub/irs-pdf/fw9.pdf[/url])
W-7 Here: [url]http://www.irs.gov/pub/irs-pdf/fw7.pdf[/url] ([url]http://www.irs.gov/pub/irs-pdf/fw7.pdf[/url])
However were are not discussing the forms here. We are discussing the hand-signed letter from FT that we need to attach to the form. It has to be hand-signed. They seem to be checking if the PDF printed version (i.e. not literally hand signed) is acceptable.
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I need to ask Fotolia that once the forms have been reviewed and approved will sales be credited appropriately that were made while the form was pending in their queue?
Not sure which deduction you are questioning here. The witholded tax won't be returned to you retroactively by FT. If you get the ITIN (and are qualified for less than 30% witholding), you would have to claim it from IRS. FT will only stop to withold it on sales from that moment on.
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Wouldn't it be a lot simpler if we all just agreed to stop uploading to FT until they have an agreement in place with the IRS that allows the form without an ITIN number? If everyone is spending $100-200 and taking time to do the paperwork for the ITIN, fotolia wont have a reason to change their stance. As several other sites appear to have worked on this arrangement with the IRS, why shouldn't fotolia?
Personally, I would rather leave fotolia than apply for an ITIN just for them. Shutterstock wanted to force us all to get an ITIN at first but when it became apparent to them that there was a better way, they quickly changed tack. I am sure the same will happen with fotolia if we give them a few weeks to see the consequences of making all their non-US contributors get an ITIN. If they still insist on the ITIN, there are lots of other sites we can use.
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My W-8 Form has been pending since 12/29. :-\
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Wouldn't it be a lot simpler if we all just agreed to stop uploading to FT until they have an agreement in place with the IRS that allows the form without an ITIN number? If everyone is spending $100-200 and taking time to do the paperwork for the ITIN, fotolia wont have a reason to change their stance. As several other sites appear to have worked on this arrangement with the IRS, why shouldn't fotolia?
I'd agree with that. No new uploads from me until FT get it sorted (or I end up exclusive).
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I believe that if Fotolia are forced to send us signed letters by mail that it will force them to reconsider the cost of mailing letters to everybody versus doing it without ITIN number. Can you imagine how time consuming it would be if all of a sudden they had to send us signed letters non-stop. Denis
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The above mention thread has changed. Daniela is checking to see if a PDF file is acceptable with the IRS. Until then we are to request the W7 letter by mail.
([url]http://www.fotolia.com/forum/viewtopic.php?id=24454[/url] ([url]http://www.fotolia.com/forum/viewtopic.php?id=24454[/url])):
Denis
The Three Stooges are running the legal department?
If you go to the IRS site and download any US tax forms, they are all PDF files!
Like this one, W-9 download, note the site is IRS GOV [url]http://www.irs.gov/pub/irs-pdf/fw9.pdf[/url] ([url]http://www.irs.gov/pub/irs-pdf/fw9.pdf[/url])
W-7 Here: [url]http://www.irs.gov/pub/irs-pdf/fw7.pdf[/url] ([url]http://www.irs.gov/pub/irs-pdf/fw7.pdf[/url])
However were are not discussing the forms here. We are discussing the hand-signed letter from FT that we need to attach to the form. It has to be hand-signed. They seem to be checking if the PDF printed version (i.e. not literally hand signed) is acceptable.
My mistake for not following the link and reading about "the form" and "the form".
Nothing personal because I know you aren't the one making up all this snow storm of forms and paperwork, but I'll stick with the Three Stooges running the legal Dept.
Keep this in mind. It has been one and a half months since this started and the latest this week is (quoting you) "An official Fotolia announcement regarding the Tax situation will be supplied shortly."
Also not your fault, but someone up top who decided to drop this crap bomb on the contributors should have also followed through on how to clean it up. ;) What I'm getting at is somewhere, someone made the decision to collect nonreturnable taxes from contributors (I don't understand that at all either... they can go file and collect it back from the IRS?) but when those people decided to start this affair, they didn't take into account what the ramifications would be for Fotolia or contributors and how to effectively make the transition. They didn't check with how to handle the exemption verification, ITIN applications or paperwork needed to make all this happen in a efficient manner.
Best wishes and nice of you to come here personally and try to answer questions concerning a sticky situation.
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Hi everyone,
I work for WorkingTitleImages in England and if you open an account with us (I believe most EU agencies) then there is no tax deducted at source. We pay 100% of gross royalties and then you declare to your home authorities at year end.
Good luck and Happy New Year
Casper
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Hey Workingtitleimages...why not try posting in this thread....
http://www.microstockgroup.com/general-stock-discussion/again-a-new-agency-workingtitleimages-com/ (http://www.microstockgroup.com/general-stock-discussion/again-a-new-agency-workingtitleimages-com/)
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Thank you LSD72, hadn't seen that one before.
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No problem. Had to check to see if you commented in it before. Since no comment... though you would like to.