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Service - Entities

Service - Entities

Owned by Heather Rutkowski
Last updated: Feb 06, 2025
4 min read

U.S. Entities

If company is from California then the invoice is going into workflow because you need to check the income code to make sure it is not DAU/AR, if so then please refer to Foreign Entities

 

This is the website to check if a company is registered in CA

https://bizfileonline.sos.ca.gov/search/business

LLC (not all LLC’s are reportable, this is determined while doing supplier setup):

  • If the entity is from Outside CA and work performed in California then it should be approved as:

1099 (Income Type) = MISC7 (can be blank per comment above)

592 (State withholding Code) = Will need to verify if they are registered.

                    If Registered with CA SoS, 592 = No (withholding = blank)

                    If not registered with CA SoS, 592 = Yes 592CA_7

 

  • If the entity is from Outside CA and work performed in California and outside CA then it should be approved as:

1099 (Income Type) = MISC7 (can be blank per comment above)

592 (State withholding Code) = Will need to verify if they are registered.

      If Registered with CA SoS, 592 = No (withholding = blank)

                    If not registered with CA SoS, 592 = Yes 592CA_7

CA reportable amount should only be the amount for work performed in CA (there should be 2 lines on the oracle doc, 1 for work in CA and 1 for work outside of CA).

CA withholding amount should be 7% of the work performed in CA

 

  • If the entity is from Outside CA and work performed in “Other US State” then it should be approved as:

1099 (Income Type) = MISC7 (can be blank per comment above)

592 (State withholding Code) = Blank

 

  • If the entity is from Outside CA and work performed in “Outside the U.S.” then it should be approved as:

1099 (Income Type) = MISC7 (can be blank per comment above)

592 (State withholding Code) = Blank

Corp, Inc, or Univ:

  • If the entity is from Outside CA and work performed in California then it should be approved as:

1099 (Income Type) = No (Blank)

592 (State withholding Code) = Will need to verify if they are registered.

                    If Registered, 592 = No (withholding = blank)

                    If not registered, 592 = Yes 592CA_7

 

  • If the entity is from Outside CA and work performed in California and Outside then it should be approved as:

1099 (Income Type) = No (Blank)

592 (State withholding Code) = Will need to verify if they are registered.

                    If Registered, 592 = No (withholding = blank)

                    If not registered, 592 = Yes 592CA_7

CA reportable amount should only be the amount for work performed in CA (there should be 2 lines on the oracle doc, 1 for work in CA and 1 for work outside of CA).

CA withholding amount should be 7% of the work performed in CA

 

  • If the entity is from Outside CA and work performed in “Other US State” then it should be approved as:

1099 (Income Type) = No (Blank)

592 (State withholding Code) = No (withholding = blank)

 

  • If the entity is from Outside CA and work performed in “Outside the U.S.” then it should be approved as:

1099 (Income Type) = No (Blank)

592 (State withholding Code) = No (withholding = blank)

 

Medical and Legal should always be 1099 Yes

Medical = MISC 6

Legal = MISC 7

  

 

Image for CA withholding

image-20240522-145420.png

 

Foreign Entities

 

  • If the Foreign Entity performed the service outside the U.S then it should be approved as

1099 (Income Type) = No (You can leave the DAU/AR)

592 (State withholding Code) = No (withholding = blank)

 

  • If the Foreign Entity performed the service in the U.S. and not in California then it should be reviewed further by Heather:

1099 (Income Type) = Yes, Federal reporting and withholding may apply (will need W-8BEN-E and it should be on the supplier profile or in iDocs).

592 (State withholding Code) = No (withholding = blank)

 

  • If the Foreign Entity performed the service in the U.S. and in California then it should be reviewed further by Heather:

1099 (Income Type) = Yes, Federal reporting and withholding may apply

592 (State withholding Code) = Yes, withholding at 7% (will need to manually calculate withholding)

 

  • If the Foreign Entity performed the service in California and another U.S. State then it should be reviewed further by Heather:

1099 (Income Type) = Yes, Federal reporting and withholding may apply

592 (State withholding Code) = Yes 592CA_7

CA reportable amount should only be the amount for work performed in CA

CA withholding amount should be 7% of the work performed in CA

 

  • If the Foreign Entity performed the service in California and Outside the U.S then it should be reviewed further by Heather:

1099 (Income Type) = Yes, Federal reporting and withholding may apply

592 (State withholding Code) = Yes 592CA_7

CA reportable amount should only be the amount for work performed in CA (there should be 2 lines on the oracle doc, 1 for work in CA and 1 for work outside of CA).

CA withholding amount should be 7% of the work performed in CA

 

 Image for CA withholding along with federal withholding

image-20240522-145634.png

Foreign income tax codes

10 - Industrial Royalties = Inventor Royalty

12 - Other Royalties = Copyrights (software, play, music)

16 - Scholarship or fellowship grants

17 - Compensation for independent personal services

23 - Other income

42 - Earnings as an artist or athlete-no central withholding agreement

43 - Earnings as an artist or athlete-central withholding agreement

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