Hello,

I sold the stock options of my company,through the CitiBank SmithBarney, in November 2007. However I forgot to submit the
W-8Ben form before 31-Dec-2007.

The authorities at the Smith Barney, say that the whole amount is withheld, and they can do nothing about it.
They have advised to meet a tax consultant in India to process this..

Could somebody please let me know how this is to be taken forward and how long does it take for the amount to be released ?

Regards,
Tilak

What do you mean by "the whold amount is withheld, and they can do nothing about it." If you had income, they can only deduct or withhold the taxes. Do you have the account statement?

What do you mean by "the whold amount is withheld, and they can do nothing about it." If you had income, they can only deduct or withhold the taxes. Do you have the account statment?

Hi,

I have confirmation letters sent by SmithBarney. Basically I had Stock Options issued to me at different periods. Hence there were three separate transactions.

I am hereby giving the Transaction Expense Calculation that is given in the letters.

Transaction 1

Transaction Expense Calculation
Total Option Exercise Price: $ 3,768.32
Backup Withhold $ 271.69
Commission $ 14.72
Transaction Fee $ 5.00
Other fee $ 0.07
Delivery Fee $ 25.00 (This is but dodgy.. )
__________________
$ 4,084.80

FMV x Shares Exercised: $ 4,084.80
Less Total Option Exercise Price ($ 3,768.32)
_______________
Exercise Gain: $ 316.48
Taxable Compensation $ 316.48

Tax Information

Tax % Taxes Due
_____________
Total Tax amount $ 0.00





Transaction 2

Transaction Expense Calculation
Total Option Exercise Price: $ 2,778.30
Backup Withhold $ 473.29
Commission $ 11.76
Other fee $ 0.05
__________________
Transaction Expenses $ 3,263.40

FMV x Shares Exercised: $ 3,263.40
Less Total Option Exercise Price ($ 2,778.30)
_______________
Exercise Gain: $ 485.10
Taxable Compensation $ 485.10

Tax Information

Tax % Taxes Due
_____________
Total Tax amount $ 0.00




Transaction 2

Transaction Expense Calculation
Total Option Exercise Price: $ 2,778.30
Backup Withhold $ 473.29
Commission $ 11.76
Other fee $ 0.05
__________________
Transaction Expenses $ 3,263.40

FMV x Shares Exercised: $ 3,263.40
Less Total Option Exercise Price ($ 2,778.30)
_______________
Exercise Gain: $ 485.10
Taxable Compensation $ 485.10

Tax Information

Tax % Taxes Due
_____________
Total Tax amount $ 0.00



Transaction 3

Transaction Expense Calculation
Total Option Exercise Price: $ 3,956.00
Backup Withhold $ 65.61
Commission $ 25.00
Transaction Fee $ 5.00
Other fee $ 0.07
__________________
Transaction Expenses $ 4,051.68

FMV x Shares Exercised: $ 4,051.68
Less Total Option Exercise Price ($ 3,956.00)
_______________
Exercise Gain: $ 95.68
Taxable Compensation $ 95.68

Tax Information

Tax % Taxes Due
_____________
Total Tax amount $ 0.00


These are the three confirmation letters.
The total Exercise gain is 897.26 and none of which is sent to me.

All they said was that they donot have any procedures to release that amount and I need to consult a Tax Consultant in India and ask him how to get the refund of this amount.

ANy help on this would be really grateful.

Regards,
Tilak

What do you mean by "the whold amount is withheld, and they can do nothing about it." If you had income, they can only deduct or withhold the taxes. Do you have the account statment?

Please find the details of the Confirmation details sent by SmithBarney, attached.

Could somebody please advise on this.

Regards,
Tilak

Do you have U.S. ITIN or SSN? If yes, why can't you file the U.S. tax return and claim taxes withheld?
Did Smith Barney issue you 1099-B showing the taxes withheld or can you download it after logging in your account with Smith Barney.

MukatA,

Thanks a lot. You have been very helpful.
But I neither have a U.S. ITIN or SSN? I was never in US nor worked there.

I donot think SmithBarney issues a 1099-B either in the paper form or online. I'd ask them over phone today.

However what if they say that they donot issue 1099-B ? How should I proceed ?

Regards,
Tilak

Normally when a U.S. company pays a nonresident, then do backup withholding (same as TDS in India). The rate is around 30%. The money is deposited with the IRS (Internal Revenue Service). It means that now you have to deal with IRS.
If you had ITIN (Taxpayer Identification Number), then you file tax return and get the refund. Now you don't have IT IN.
You may have to do tax return and attach W7 (application for ITIN) with it and send to IRS. Or you may call IRS first and find out.

Before that find out from SmithBarney what info or Form they can provide that you can show to the IRS that taxes were withheld.

You are a star..

I got a few documents from my Broadridge office (I am not presently working there)
And found this 1099-B.


I see the Tax Id Number (is this the same as ITIN) : 11-2418191

Could you please explain it from here please ?

Thanks in advance,
Tilak

No this is the company's Tax ID. This is what you need.
The 1099 shows tax withheld, your account number and your social secuirty # as blank.

Now you have to deal with IRS. Call them and tell them that you are a foreign alien, never came to U.S. have a 1099 from a U.S. brokerage company with tax withheld based on amount of sales and not on the profit. What forms you must file to report the sales and get the refund? For IRS number check at Internal Revenue Service (http://www.irs.gov) or I will let you know after some time.

This is what I found: Taxpayers located outside the U.S. may also contact the IRS by mail at:
Internal Revenue Service
P.O. Box 920
Bensalem, PA 19020

Or you may telephone or FAX the Philadelphia Service Center office at:
Tel: 215-516-2000 (not toll-free)
Fax: 215-516-2555

Thanks again MukatA.

There seems to be a waiting time extending to eternity on those phone lines.

However, I need little clarification. YOu said

"No this is the company's Tax ID. This is what you need."

Is that the Tax Id number I needed?

This is what you need means that for filing you need this Form 1099.
Write a mail to IRS, and wait for reply.