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How do I account for Australia withholding tax...
I'm a photographer living in California. I sell my work through various photo stock agencies. One of those companies is Canva, which is located in Australia. They have a tax treaty with the US that allows them to withhold taxes based on my yearly earnings . They don't send me a 1099; they just send me a simple e-mail stating how much money I made and how much money was withheld. For the latest period, they withheld $86.20; on their statement it's simply listed as "tax withheld." I'm assuming they send this money to the IRS? So how should I enter this using TurboTax? The "Other Income" section? But my main question is how can I get the credit for the tax paid? Wouldn't it lower my tax amount due by $86.20? Where/how do I enter this info using TurboTax? Additionally, I'm a US citizen, and don't physically work in Australia. The company has an "ABN" number; other than that, no other info other than basics like location, contact info, etc. It's a small amount, but nowadays every dollar saved counts! Thanks in advance to any advice given.
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How do I account for Australia withholding tax...
I believe the amount withheld would be reported under "Foreign Tax Paid".
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How do I account for Australia withholding tax...
Well, that sort of works, but it requires that I list the income as "personal income" as opposed to "business income," which it is. Doing it this way lists my earnings as "wages," which they're not; they're royalties. But it did reduce my tax amount by almost the same amount as was originally withheld, so I went ahead and listed it this way. It's not a big amount, so even if I did it incorrectly, the affect on my overall return is negligible.
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