[cd34]

Basically when a sponsor pays webmasters more than $600 (or so, can't remember, my accountant deals with it), and they are a US resident, a 1099 needs to be filed. For this, a W-9 form is requested when the person signs up. Many sponsors and processors don't do this.

However, if the IRS questions it, then you have to show that you are either withholding, or exempt. For non-US webmasters getting paid from a US Based corporation, the W8BEN needs to be filed. Refusal to file the W8BEN could end up having the company either not send the payment -- or withholding 30% which you would later have to claim from the US Government.

The law has always been there, however, its usually not enforced until someone at the IRS questions the company doing the payouts.

I would imagine in the next year, many many sponsors will start sending W9 and W8BEN forms to webmasters -- no matter how much the payout.