Form Nc-30 - Income Tax Withholding Tables And Instructions For Employers - North Carolina - 2017 Page 8
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46calendar year. Federal Form 1099-MISC may be filed
withheld from a payment that is not compensation, or
if it is in excess of the amount required to be withheld.
in lieu of Form NC-1099-ITIN if it reflects the amount
of North Carolina income tax withheld. Form NC-1099-
ITIN must be given to the contractor by January 31
8� Withholding on Contractors
following the calendar year in which the compensation
Identified by an Individual Taxpayer
was paid. If the services are completed before the end
Identification Number (ITIN)
of the calendar year and the contractor requests the
The following definitions are applicable with respect
form, it is due within 30 days after the last payment of
to withholding on contractors identified by an ITIN:
compensation to the contractor.
(a) Compensation. Consideration a payer pays to
The Annual Withholding Reconciliation (Form
an ITIN holder who is a contractor and not an employee
NC-3) that reconciles the amount withheld from
for services performed in North Carolina.
each contractor must be filed with the Department
on or before January 31 following the year in which
(b) ITIN contractor. An ITIN holder who performs
the compensation was paid. Payers who report only
services in North Carolina for compensation other than
ITIN compensation withholding must file the annual
wages.
reconciliation report and include the withholding
statements. Payers who are subject to both wage
(c) ITIN holder. A person whose taxpayer
withholding and withholding from ITIN compensation
identification number is an Individual Taxpayer
must file one annual reconciliation report that includes
Identification Number (ITIN). An ITIN is issued by the
the two types of withholding statements.
IRS to a person who is required to have a taxpayer
identification number but does not have and is not
Amounts withheld in error. If you withhold an
eligible to obtain a social security number.
amount in error and the amount is refunded to the
contractor before the end of the calendar year and
(d) Payer. A person who, in the course of a trade or
before you give the NC-1099-ITIN to the contractor,
business, pays compensation to an ITIN holder who is a
do not report the refunded amount on the NC-1099-
contractor and not an employee for services performed
ITIN or the annual reconciliation statement. If the
in North Carolina.
amount withheld in error has already been paid to the
Department, reduce your next withholding payment
Withholding requirement. If, in the course of your
accordingly. Amounts are considered withheld in error if
trade or business, you pay compensation of more than
they are withheld from a person who is not a contractor,
$1,500 during the calendar year to an ITIN contractor,
if it is withheld from a payment that is not compensation,
you must withhold North Carolina income tax at the rate
or if it is in excess of the amount required to be withheld.
of 4 percent of the compensation paid to the contractor.
However, withholding is not required on compensation
9� Payee’s Identification Number
paid to an ITIN holder who is temporarily admitted to the
United States to perform agricultural labor or services
An individual employee or nonresident contractor
under an H-2A visa and who is not subject to federal
is identified by the individual’s social security number.
income tax withholding under section 1441 of the Code.
A contractor that is not an individual (corporation,
partnership, limited liability company) is identified by its
How and when to pay the tax withheld. If you
federal identification number. Show the payee’s social
pay compensation to an ITIN contractor and you do
security number, federal identification number and the
not already have a withholding account identification
name and address on Forms W-2 and NC-1099PS and
number, you must complete Form NC-BR. You must
use it in any correspondence pertaining to a particular
report and pay the tax withheld on a quarterly, monthly,
employee or contractor. ITIN contractors are identified
or semiweekly basis depending on the average amount
by their ITIN numbers. An ITIN number is issued by
withheld during the month. (See numbers 15, 16, and
the IRS to a person who is required to have a taxpayer
17 for determining the basis on which to file.) If you
identification number but does not have and is not
withhold from ITIN contractor compensation and wages,
eligible to obtain a social security number. Show the
you must report the withholding from ITIN contractor
payee’s ITIN number on Form NC-1099-ITIN.
compensation with the wage withholding.
10� Withholding from Wages
Form NC-1099-ITIN and annual reconciliation
requirement. If you withhold tax from an ITIN
The term wages generally has the same meaning
contractor, you must give the contractor Form NC-
as in Section 3401 of the Internal Revenue Code except
1099-ITIN, Compensation Paid to an ITIN Contractor,
that it does not include the amount an employer pays an
showing the amount of compensation paid and the
employee for reimbursement of ordinary and necessary
amount of North Carolina income tax withheld during the
business expenses of the employee. North Carolina
Page 8
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