The Tax Information section helps you maintain accurate tax records and ensure tax compliance. Properly filled in tax information is essential for us to verify your business on Book with Buddy. As an online marketplace, we are responsible for calculating, retaining and reporting your sales taxes. Therefore it is crucial to provide accurate and up to date information.
Watch our quick tutorial to learn how to keep your tax information up to date 👇🏻
Tax Identification Management
Managing your tax identity on the platform ensures proper financial reporting and compliance. The platform adapts the required information based on your business location and type, ensuring you provide all necessary details for your jurisdiction.
There is two scenarios which determines what information you need to provide. One is if you business is registered in the US, the second if it is outside of the US.
Tax information needed from US businesses
You need to accurately fill in the following fields:
Legal Business Name
This is the official legal name of your business and it must match your official registration documents
Legal Entity Type
The platform supports the following legal entities
Sole Proprietorship
Limited Liability Company (LLC)
C Corporation
Partnership
Non-profit
Tax Classifications:
Sole Proprietorship
Limited Liability Company (LLC)
C Corporation
S Corporation
Partnership
Non-profit Organization
W-9 document
After filling in the correct information for the aforementioned fields, we need a filled in W-9 form on record.
Guidelines for filling it in:
Box 1 or 2 needs to be filled
In Box 3a, either individual/sole proprietor, C-corp, S-corp, Partnership or Trust/estate needs to be checked or if none of the top rows are checked, LLC box needs to be checked. In the latter scenario, n C, S, or P also needs to be marked next to it.
Box 5 and 6 needs to be completed
Either a SSN or EIN needs to be provided. If Individual/Sole Proprietor box is checked it should be SSN. If any other selection is made above it should be an EIN
Signature and date
Tax information needed from non-US businesses
You only need to accurately fill in the field for Legal Business Name. This is the official legal name of your business and it must match your official registration documents
W-8BEN / W-9BEN-E Document
Foreign individuals use W-BEN & foreign businesses use W-8BEN-E.
Box 1 - Required
Box 2 - Required
Box 3 - Required
Box 4 - Optional
Box 5 - Optional
Box 6 - Required unless the country does not issue TINs
Box 7 - Optional
Box 8 - Required
Line 9 must match Line 2
Line 10 must state the article and paragraph number of the US treaty with that country.
It must be signed and dated.
Frequently Asked Questions
Frequently Asked Questions
Platform Tax Responsibilities
Q: What are Buddy's tax responsibilities as a marketplace facilitator?
A: As a U.S. marketplace facilitator, Buddy handles two distinct areas of tax compliance:
Sales Tax Compliance: We collect, report, and remit sales tax where applicable under state laws. If a state considers certain activities or services taxable, we handle the sales tax on those bookings and remit it directly to tax authorities on your behalf. You don't need to take any action for sales tax compliance.
1099 Reporting: Because we process payouts to your business, we're required to comply with IRS information reporting rules. We collect W-9 forms from U.S.-based businesses to gather legal names and tax IDs, enabling us to issue 1099-K or 1099-NEC forms at year-end if your earnings exceed IRS thresholds.
Q: Do you withhold income taxes from my payouts?
A: No, we do not withhold any income taxes from your payouts. Tax payment and filing on that income remains your responsibility. We only handle sales tax collection and remittance as required by state laws, and provide 1099 reporting for IRS compliance.
Tax Setup
Q: What happens if my tax information changes?
A: When your tax information changes:
Update your profile immediately
Provide new documentation
Complete verification if required
Maintain records of changes
The platform helps track these changes and ensures continuous compliance while updates are processed.
Q: How do I handle multiple tax jurisdictions?
A: For businesses operating across multiple jurisdictions:
Provide primary tax location
When you create activities select the correct Activity Location so that the system can apply the correct tax rates. More information is available here.
If your business is registered separately in multiple countries, you need to register multiple accounts on the booking platform. Reach out to support for further clarification.
Q: I am a U.S. citizen but a full-time resident of another country. How should I handle tax documentation?
A: Since you're a U.S. citizen, we'll need a completed W-9 form on file regardless of your residence. If your payments meet IRS reporting thresholds, we may be required to issue you a 1099. U.S. citizens are required to report global income, and the W-9 enables us to provide proper 1099-K reporting as a payment processor.
Documentation Requirements
Q: What tax documents should I keep updated?
A: Essential documents include:
Tax identification forms (W-9, W-8BEN, W-8BEN-E)
Business registration certificates
State/local tax permits
Keep these documents current and readily available in your platform profile.
Q: How often should I review my tax information?
A: Regular tax information reviews should occur:
Annually at minimum
When business details change
During tax season preparation
When regulations update
Q: What special considerations apply to non-profit organizations?
A: For non-profit organizations:
Complete and upload a W-9 form (check "C Corporation" box)
You typically won't receive a 1099 from payment processors
Sales tax may still apply unless you have state-specific exemption certificates
Non-profit status doesn't automatically exempt you from sales tax - you must send us valid state-specific exemption certificates to qualify for sales tax exemption
Compliance and Verification
Q: How do I ensure my tax setup is correct?
A: Verify your tax setup by:
Reviewing all entered information
Checking document accuracy
Confirming tax classifications
Consider having a tax professional review your setup.
Q: What if I find errors in my tax information?
A: To correct tax information errors you can update/upload the correct information/form from the tax information page.
Contact platform support if you need assistance with corrections.
International Considerations
Q: I am a business NOT based in the US. Which document should I upload?
A: For businesses that are not based in the US you need to upload form W-8BEN or W-8BEN-E based on the type of business.
W-8BEN if you are an individual
W-8BEN-E if you are a business
The system handles different tax systems appropriately.