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How to handle payroll taxes in USA for foreign freelancer from Odesk Agency.

Freelancer working for my agency is from India. My agency is in USA and Odesk sends payments to my USA business account. I will wire transfer the payment from my business account to my freelance bank account which is in India. 1)As freelancer in India, will not able to raise form 1099. How should I handle tax in this case? 2)Do I need to pay and payroll taxes to US government?. If yes, how much and when? Thank you, Harish

There are no payroll taxes because freelancers are self-employed, not employeees. Freelancers are responsible for paying taxes to their country. If you are working in the US, you do have to report your income to the US government.
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