Tax Information
If you are filling invoices for more than $600 USD per year to a Collective with a Fiscal Host in the US (receipt reimbursements don't count toward the $600 limit, only invoices), you will need to send them a form W9 (for US persons) or W8-BEN/E (for non-US persons). The fiscal host admin should contact you if you are required to submit a form.
For tax purposes, you will likely be treated as an independent contractor and you will be issued a 1099 if your earnings exceed $600. Here's a good explanation of how W-9s work for independent contractors, and there's more info on what a 1099 is here.
If you don’t meet the $600 threshold, simply report your earnings as miscellaneous self-employment income when you file your taxes.
As US-based entity, Open Source Collective must collect tax forms as described above. Unlike other hosts, it has an automated tax form system.
When you submit an expense that puts you over the $600 threshold, you will be sent an email with a link to complete your tax form online. This email will come from HelloWorks, the system we use to handle the forms.
Your expenses will not be paid out to you until you submit the tax form.
Note: Going forward, invoice expenses and receipt expenses will be differentiated. However, they were not in the past, so receipt expenses might be mistakenly counting toward the $600 threshold. If that's the case for you and you don't wish to submit the tax form, please contact support@opencollective.com so we can sort it out.
Collectives that live under the umbrella of a Fiscal Host, don't need to worry about accounting and tax obligations, because the host manages that (this is the awesome value of fiscal hosting). If you need tax or accounting information for some reason, get in touch with your fiscal host.
Some Collectives run their own Fiscal Host, and they have all the normal tax and reporting obligations of any legal entity. In that case, consult with your accountant to understand the requirements for taxes.
