Quote:
Originally Posted by faxxaff
If that is true, she should get the full amount from MFC without questions asked.
Then at the end of the year she will need to report all of her income in Spain and pay taxes accordingly to the Spanish revenue service..
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I’m not sure about that because the law although extremely complex like everything else prepared by the IRS does seem to be pretty clear,
Publication 515 - Internal Revenue Service
Withholding of Tax
In most cases, a foreign person is subject to U.S. tax on its U.S. source income. Most types of U.S. source income received by a foreign person are subject to U.S. tax of 30%.
A reduced rate, including exemption, may apply if there is a tax treaty between the foreign person's country of residence and the United States. The tax is generally withheld (chapter 3 withholding) from the payment made to the foreign person.
MFC is big company that sends all kinds of money to foreigners and I doubt they would run the risk of being held liable for all those taxes, it would wipe them out.