U.S. source rental income paid to nonresidents is generally treated as FDAP income and subject to taxes on gross income. A nonresident filing Form 1040-NR can elect to treat the income as ECI and pay taxes on a net basis.
The IRS Form W-8 series of withholding certificates are completed by non-U.S. persons and entities. A U.S. person would complete Form W-9.
The Form W-8ECI is a type of withholding certificate used by foreign persons to disclose their income is effectively connected with a U.S. trade or business. This article and video tutorial cover the basics of the Form W-8ECI.
