 Backup Withholding
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Backup Withholding
When a customer or beneficiary fails to give his or her social security number or taxpayer identification number, and is unable to provide proof that he/she is not subject to backup withholding, the source of the income (or, in Wachovia's case, the financial service provider acting as agent for the customer) must withhold federal income tax at the rate of 20% of the income received.
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