Simplified Central Withholding Agreements
**IMPORTANT: The IRS has temporarily waived the income requirement for which form to use when applying for a CWA. Form 13930-A is currently unavailable. While the waiver is in effect, individuals with income below $10,000 can apply for a CWA using Form 13930, Instructions on How to Apply for a Central Withholding Agreement
The IRS has announced a new simplified application process for nonresident performers applicants earning less than $10,000 gross income in a calendar year. Form 13930-A, Application for Central Withholding Agreement (under $10,000), allows individual artists -- Non-Resident Alien Athletes or Entertainers (“NRAAEs”) -- to apply by submitting the requested documents online at Pay.gov. Unlike applicants to the CWA program for earnings over $10,000 gross income, applicants qualifying for the simplified CWA may not deduct any expenses in calculating their income subject to withholding. (Difficulty accessing the form? See instructions here)
Instead, the withholding payment required upfront is 10% of gross income up to $9,700, and 12% on the incremental gross income amount between $9,700 and $10,000.
Applicants will need to take great care; there is a risk that unintended errors or inaccuracies will render the applicant and/or designated withholding agent ineligible to enter into a CWA agreement for up to a three year period.
The IRS website lists the following basic requirements for an artist or group requesting a simplified CWA:
- Gross Tour Income of less than $10,000.
- Completed Application Form 13930-A must be received by the IRS at least 45 days prior to the first event to be covered under a Simplified CWA.
- U.S. tax returns for the current and prior three tax years, if personal services were performed in the U.S. in the current or prior three tax years, filed and posted prior to CWA application filing. Note that an ITIN or SSN is required to file a U.S. tax return.
- Satisfied payment obligations for all years or an approved payment arrangement with the IRS.
- Form 13930-A along with required withholding payment to be submitted through Pay.gov by the Designated Withholding Agent (DWA). The DWA must establish a Pay.gov account.
- The DWA must have a U.S. bank account and a U.S. Employer Identification Number (EIN).
The CWA application will also need to provide:
- The NRAAE’s SSN (or the NRAAE should apply for an SSN while in the U.S.) See www.ssa.gov for more information.
- Compete Form 13930-A, with signed Declaration pages for each NRAAE (which includes NRAAE’s commitment to timely file and pay Form 1040NR or Form 1040NR (EZ) for the year of the CWA).
- Form 2848, Power of Attorney and Declaration of Representative, or Form 8821, Tax Information Authorization for each NRAAE, if applicable.
- Advance withholding payment deposit confirmation information.
- Supporting documentation and other tax forms:
- Any statements showing 30% U.S. withholding that already occurred in the calendar year, or statement that no U.S. income was earned.
- Documentation of income to be earned (e.g. contracts, letters of understanding, etc.).
- If applicable, documentation of any merchandising, endorsements, sponsorship income, production or tour support, and reimbursement income for the tour.
- Itinerary of dates and locations.
- Schedule of gross tour income (with itemized estimates of gross income)
Please see a list of Frequently Asked Questionsrelated to the Simplified CWA.
**If clicking on the link for the Form 13930-A directs you to a page that reads “Please wait…” , try downloading the PDF from that same location despite what you see; you should be able to open and complete the form when you open the saved file from your desktop. If the form still does not appear after downloading it to your computer, you can access a non-fillable version here.
*Special thanks to Elizabeth Moller, counsel/legal fellow at Tamizdat, for this Simplified CWA content and FAQ.