Have a Tax Question? Ask a Tax Expert
Hi my name is Mark. I will be happy to help you with your questions.
I am sorry, I had to step away from the computer. Let me make sure that I understand the question. You are the US company and you paid an Ecuadorian vendor and withheld funds. Is this correct?
Let's say that the invoice from the vendor is $10,000. If you paid the vendor $7500 and withheld $2500 you could claim a $10,000 deduction. If you paid $10,000 to the vendor and a withholding of $2,500 you could deduct $12,500. I am not sure that I am completely understand your question. I will look forward to your response.