Disclaimer: US-based merchants: We’re going to give you some light, unofficial guidelines here. But you should always consult a tax attorney for the official word! And if you are based outside the US, you should consult your country’s tax authority.
More often than not, affiliates, influencers, and ambassadors are considered 1099 (independent) contractors by the IRS.
Onboarding: You’ll first need to establish your affiliates’ tax status. You’ll do this by collecting a W9 form from US-based affiliates and a Form W8-BEN / Form W8-BEN-E from affiliates based outside the US. (The penalty for forms not filed is $270 each.)
End-of-Year: It’s up to you, the merchant, to furnish a 1099-NEC for US-based affiliates who are paid enough money (or had any withholding) to exceed the IRS threshold. Starting in the tax year of 2026, this threshold is $2000 USD (previously the threshold was $600). You’ll need to furnish a 1042-S to Affiliates based outside the US who earned any income (or had any withholding) from your program within the tax year.
You’ll need 3 copies of your forms: one for your records, one for each Affiliate, and one for the IRS.
If you want to use Refersion to store affiliate tax information, then you have a couple of options:
US-based businesses whose commissions are in USD can sign up for Unified Payments to take advantage of automated payments and tax management. You can click here to learn more.
You can leverage Refersion's integration with Trolley for tax form collection and payments as well as 1099 distribution at the end of the year. Read all about the Trolley integration here.
If neither of the above are suitable options for you, then you'll have to collect and store tax information outside of Refersion.