IRS Instructions for Form W-8BEN-E: the chapter 4 (FATCA) status line, and royalties in the active NFFE test (IRS, Instructions for Form W-8BEN-E (Rev. 10-2021), Purpose of Form; Line 5; Part XXV, Line 39)
Besides the treaty claim, the form records the holder's status under the separate FATCA rules (chapter 4) on line 5, and without it a buyer may withhold the default rate anyway. An operating company that is not a financial institution commonly certifies as an active NFFE, a test in which royalties count as passive income, so a holder whose income is mostly licence fees checks that test before ticking the box.
Dated 18 Oct 2026Source checked 18 Oct 2026Basis: primary text
In the source's own words
“A withholding agent may request this Form W-8BEN-E to establish your chapter 4 status and avoid withholding at a 30% rate on such payments. ... Line 5. Check the one box that applies to your chapter 4 status. ... Line 39. If you are an active NFFE you must check the box to certify that you meet all of the requirements for this status, including the assets and passive income test described in the certification for this part. For purposes of applying this test, passive income includes dividends, interest, rents, royalties, annuities, and certain other forms of passive income.”
Where it was read
Also read from the same source
- IRS Instructions for Form W-8BEN-E: foreign entities document their status, and royalties are taxed at 30 percent (IRS, Instructions for Form W-8BEN-E (Rev. 10-2021), General Instructions, Purpose of Form)
- IRS Instructions for Form W-8BEN-E: give it before the payment, or expect 30 percent withholding (IRS, Instructions for Form W-8BEN-E (Rev. 10-2021), When to provide Form W-8BEN-E to the withholding agent)
- IRS Instructions for Form W-8BEN-E: the tax number and the treaty claim in Part III, lines 14a and 14b (IRS, Instructions for Form W-8BEN-E (Rev. 10-2021), Line 9b and Part III, Lines 14a-14b)
Figures it counts in
It is shown on its own, not counted into a figure.
Cited in this guide