Note: This is for those who’ve decided to take the indie publishing route. Before you read this post, please visit e-Publishing Adventures part 1.
Applying for an EIN
I called the IRS and was put on queue for 30 minutes. A nice lady called Jane assisted me in applying for an EIN (Employer Identification Number) which took me another 30 minutes. Filling up the form is quite easy. It just took some time since you have to spell everything out and repeat things a few times. My only problem was my name. My first name consists of 3 names (long story) and the field could only fit in two: first and last name. I felt very odd having to pick 1 out of 3.
Make sure to state that you’re a self-employed sole trader and that you’ll be selling ebooks.
For line 11, I opted for the date I called to register for the number which is July 2, 2014.
Before the call ends, the operator will give you your EIN, which can be used upon receipt. They will also inform you that an important document will be posted to your address in 2-3 weeks.
Tip: Before you call them up, make sure to have a copy of the SS-4 form in hand. Firstly, it’s easier to follow the operator who’d be filing it for you. Secondly, it will act as your personal copy.
If you’re using Amazon’s KDP, you won’t need to mail the form. All you need to do is visit your KDP account’s page and update Tax Information.
In line 6, provide your ITIN or EIN. For other e-publishing platforms that are using the newly revised W8-BEN, provide your ITIN. But, if you have a Foreign tax identifying number, fill up line 7 (for Philippines, that would be your TIN).
Claiming Tax Treaty Benefits:
Tick checkbox 9a and write the name of your country in FULL, no abbreviations.
Answer line 10. Refer to United States Income Tax Treaties. Select your country of residence. In the Table of Articles, look for Royalties. (Or, you can visit the links I provided in e-Publishing Adventures part 1)
If you’re Filipino, I can provide you with the necessary information:
- Article: 13 (This can be found in the Table of Articles)
- Withholding rate: 15%
- Type of income: Royalties
- Reason: Beneficial owner is a resident of the Philippines
Sign your name under Individual capacity.
Afterwards, you can upload and sell your ebook. 🙂