I am the President of an S-Corp registered in CA. I use an offshore company to do software development for my US clients, but I don't have any ownership or partnership with this outsourced company. All I do is make monthly payments for the services that they perform. They invoice me and I wire the money.

Question: I have lumped all these payments under "Outside Services" for the entire 2016 year. Wanted to confirm if this is the right way to report, and if there's anything else I need to do to show that the amount was the correct amount invoiced and the exact amount paid to this offshore/outsourced company.

Thanks for your responses.

you basically need to request a form w8ben from your payee overseas.you as an U.S. person who makes a payment of income to a foreign person may have withholding tax liability . yu may request a form w8ben from the foreign payee;This form is used to establish entitlement to a reduced withholding rate or exemption under an applicable treaty.
Without the w8ben, you need to

you, The standard 30-percent withholding rate may be reduced or eliminated based on an applicable treaty or Code provision but there are stringent documentation requirements associated with claiming those exemptions.as aWithholding agent, when you fail to withhold or properly document why you did not withhold can be personally liable for the underwithheld tax.you
must annually fi le Form 1042 to report your total withholding tax liability, amounts withheld, reportable amounts paid to foreign person and other relevant information, and fi le (with the IRS) and issue (to each foreign recipient of the payments) Forms 1042-S showing the amounts and types of income paid to each recipient, the taxes withheld, and any applicable withholding exemptions.
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Thanks for your response. The payments my Corp made to offshore were not to individuals, they were made to a private Ltd company. What forms do I need to file to report these payments?