Hello everyone and congratulations on your wonderful work helping all of us! I own a company in Romania that provides online phone services and i am a Romanian too paying all my taxes in Romania. I would like to hirr some US-citizens to work as freelancers for my company. So my queetion is around that since I am not familiar with USA tax system: 1.The USA freelancers I will hire will be responsible for their ow taxes which I guess means that they need to fill a 1099 form, correct? Or they do not need to since the money they will get will be from a foreign company? 2. I checked some 1099 forms online and I noticed that in the top left the payer’s and receiver’s TIN should be added. I have a romanian tax identification number, is this suitable for this form or a USA TIN is needed? If a USA TIN is needed and I do not have one, this means that I cannot work with US citizens or they cannot work for a foreign company? 3. In case one of my freelancers receive payments from my personal bank account instead from the company, are they required To fill 1099 too? And what is the procedure that is followed when a USA citizen receives monthly payments for services from a personal account without this being a company? So sorry for the long email and thank you for your answers
Foreign entities don't pay or need to be concerned with the US taxes of US entities they may do business with.
You pay US taxes if you are US citizen or a US-based business. You may pay tariffs on trade if you are a foreign entity. However, hiring people based in the US is not "trade" since no goods are resold in the US.
Anyone in the US you hire is solely responsible for their own taxes and declaring any income they earn. You do not need to do anything with respect to US taxes of freelancers, and that includes 1099s. 1099s are required for US-Based businesses. Some inexperienced US Freelancers may ask for a 1099, but as a foreign entity you are not required to provide one. 1099s just make tax filing easier for the freelancer because you detail the amount you spent and they don't need to keep accurate records or do any math, that's all.
Be aware, I am not a tax professional. However, I am US-based and have worked with clients in the EU over the years, never anyone in Romania though.
For a definitive answer, you really should speak to a tax professional familiar with international business regulations regarding your own country. So, your best bet is to find a Romanian accountant and ask them.