If I write for a company and some of the work and hire someone from GAF or Guru to help with some of the writings, could I claim the money I used to pay the person as "Business Expense"?
What kind of information would I need to keep? Does the freelancer have to be within the United States? Thank you Mjewel for your response.
You have to be able to document the payment(s) - in other works, prove you paid the money. They do not have to live within the US.
an invoice would be useful. Just sending money to someone and claiming it is a 'business expense' has in the past landed numerous people in a world of trouble.
Thank you everyone for answering my question. I really appreciate it. I have been looking around and the "w8" form keep coming up. Would I have the freelancer fill out one of these forms? Also would I send them the agreed payment, would I am require to withhold a certain percentage. Thank you once again
I think you are talking about the W-9 form, and I send it to everyone that I work with. The W-9 asks for their taxpayer ID information. With the new tax laws, if they are based in the US, it is best to send them a form 1099 at the end of the year regardless of how much you paid them. Form W-9 gives you the info you need to file form 1099. And no, your are not required to hold anything back from a 1099 contractor, unless the IRS specifically tells you to.