Does a non-payer promoter on a co-promoted event have any liability for nonresident alien withholding?
Under section 1441(a) of the Internal Revenue Code, any person having the control, receipt, custody, disposal, or payment of any item of taxable income payable to or for the benefit of a nonresident alien or other foreign person is subject to the requirement to withhold 30 percent U.S. federal income tax on the payment of such item of income. This means that for any given athletic or entertainment event there could be several withholding agents who have a potential liability for withholding tax on any payments made to or for the benefit of a nonresident alien athlete or entertainer. If a co-promoter receives funds that are not paid to or for the benefit of the non-resident alien athlete or entertainer, the co-promoter would not be liable for withholding. An example of this would be in a professional athletic event where there are two promoters and one of the promoters is not promoting anyone who is a non-resident alien. The funds received by that promoter are only for the U.S. resident
