What is backup withholding?
Backup withholding is a 24% Federal tax that the IRS requires us to withhold on earnings on certain types of income. This typically occurs when a taxpayer hasn’t reported income correctly to the IRS in the past. State backup withholding may also apply depending on the state where you reside.
How do I know if I’m subject to backup withholding?
Backup withholding is uncommon. The IRS would notify you or CoinZoom directly in writing if this did apply to you.
For more information on the different types of backup withholding, visit https://www.irs.gov/businesses/small-businesses-self-employed/backup-withholding
CoinZoom will ask you to verify your account information, and then declare if you are subject to backup withholding like the following screenshots.
