Check out some similar questions!

macpassport · Jul 16, 2009, 08:26 PM

I did not send the W-8BEN that I was suppose to send last December, so Etrade with held 30% of the total balance, not only the interest or capital gain but from the whole amount. They did that this morning. I sent the W-8BEN form overnight this morning. Can I still get the money back? Please advise

ebaines · Jul 17, 2009, 08:42 AM

E-trade won't refund the amount they've already withheld, because presumably they have sent it on to the government on your behalf, so they don't have it any more. This counts as taxes you've paid in 2009, and so will affect the amount of refund you get when you file your 2009 taxes.

I don't understand what you mean by "30% of the total balance" - total balance of what? They should have withheld income taxes only on the taxable portion of any distributions - meaning interest, dividends and capital gains - and not on the return of any initial investment you made. What kind of an account is this?

AtlantaTaxExpert · Jul 17, 2009, 10:28 AM

I agree with ebaines; there is no justification for Etrade to withhold 30% of your initial investment. THAT you can probably get refunded to you from Etrade as an improper withholding.

macpassport · Jul 17, 2009, 11:53 AM

Thanks for your response. I mean they applied the 30% to initial investment not the profits or interests. Since I do not file taxes in the USA, what do I do, Ido not live in the USA and do not report to the IRS.

ebaines · Jul 17, 2009, 12:44 PM

I strongly suggest you call ETrade and ask why they withheld tax on the return of your original investment is for. Perhaps they have no record of your cost basis for your investment, so assumed it was $0? I think you're going to have to file a tax return in January, showing $0 tax owed for the year, and that way get your withholding back as a full refund.

macpassport · Jul 17, 2009, 05:00 PM

Thanks Ebaines for your asnwer I will do that. Thanks also to the Atlanta Tax Expert for the coments.

Regards