The Internal Revenue Service (IRS) is the U.S. federal agency responsible for administering and enforcing tax laws, including the collection of taxes and processing of tax returns.
What is the Internal Revenue Service (IRS)?
The IRS operates under the U.S. Department of the Treasury and manages the federal tax system. Its responsibilities include collecting income, employment, and corporate taxes; processing tax returns; issuing refunds; and enforcing compliance through audits and investigations. The agency also administers various tax benefits, such as deductions, credits, and stimulus payments.
For non-U.S. residents with U.S. companies, the IRS plays a critical role in issuing Employer Identification Numbers (EINs), processing tax filings, and determining tax obligations. This includes handling forms for withholding taxes on payments to foreign individuals or entities (such as Form W-8BEN or W-8BEN-E) and overseeing special tax regimes like FATCA for reporting foreign assets. The IRS also enforces rules around business structures, pass-through taxation, and international tax treaties.
Maintaining compliance with IRS requirements is essential for avoiding penalties and maintaining good standing. Businesses must keep accurate financial records, file returns on time, and ensure that any withholding obligations for foreign owners, contractors, or employees are met.
