HI
The answer depends on how much have you earned in a year.
U.S. law requires market research companies based in the U.S. to report any amount over $600.00 paid to an individual over a single calendar year, to the IRS. If you reach this threshold, the research company will send you a form called a W9, whose information will be sent to the IRS. The form will ask you for your personally identifiable information (full name, address, etc.) as well as your SSN. This is strictly for tax purposes only and is the only time when it is acceptable to provide a research company with your social security number.
Although you might not have to pay taxes on your earnings and prizes from online surveys, it is in your best interest to report them to the IRS. If you must pay tax on your survey earnings, your marginal tax rate will depend on your income and tax-filing classification. All US citizens of the age of majority, are required to file income taxes, and upon doing your taxes, you will learn how much (if any) tax you will pay on your tax return.
Where to report survey taking income
On your tax return (form 1040), there will be a line (currently, line 21) entitled “Other income”. Use this line to report the sum total of your earnings from survey taking. This line is used to report a variety of sources of income such as include winnings from lotteries, scholarships, rebates, etc. Online surveys income falls under the subcategories, ‘Non-employee Compensation’ and/or ‘Rewards’ and can be included here. However, if you filled out a W9, it may be best to use Schedule C.
Do non-USA residents fill out W-9s?
If you’re located outside the US, but earn $600 or more in any given calendar year with a market research company located in the USA, you may be asked to complete a W8-BEN. This is essentially the W-9 equivalent for non-USA residents. The form is pretty simple and is called, “Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals).” It essentially verifies that you are a non-USA resident, and are the beneficial owner of the income. Once completed, the form should be submitted to the payor (in this case, the market research company) and not to the IRS.
Foreign persons are subject to the U.S. income tax rate of 30% however many, if not most developed nations have a tax treaty with the USA so that residents of these countries will not have any of their earnings withheld. However, again, you must complete a W8-BEN in order to verify your citizenship of one of these nations in order to have nothing withheld and to continue receiving your earnings without issue.
What If i refuse to fill out a W-9?
If you’re asked to complete a W-9, but refuse to do so, you may be penalized $50 by the IRS for every instance. As well, the market research company may withhold 28% of your earnings and forward the proceeds to the IRS as a type of backup withholding. More commonly, the survey company will just stop sending you surveys, thereby halting any future earnings. The best thing to do is to fill out a W-9 when you’re asked to do so and complete it correctly using real and accurate information.
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