Here is everything you need to know to decide if you should prepare a W-9 for payments, or ask for one from your vendors. To be safe, some businesses will send out Form W-9 to every single one of their contractors to fill out ahead of time, even if they don’t expect them to perform $600 of work for them. Some accountants will even suggest collecting a W-9 before issuing any payments at all to encourage people to file up-front. If you’re a contractor and you receive a Form W-9 from an individual or business who is not a client, don’t fill it out. Sending your Social Security number and other personal information to a stranger could be dangerous. Scammers will sometimes send W-9s to collect the SSNs of unsuspecting individuals. The taxpayer must select whether they are a corporation, individual, sole proprietor, single-member LLC, limited liability company, partnership, or trust/estate.

For tax years beginning after 2017, applicants claimed as dependents must also prove U.S. residency unless the applicant is a dependent of U.S. military personnel stationed overseas. A passport that doesn’t have a date of entry won’t be accepted as a stand-alone identification document for dependents.

About Form W-9, Request for Taxpayer Identification Number and Certification

He pushed back on the requirement, but eventually relented and gave us that all-important form. Section 6109 what is a w9 for a business of the Internal Revenue Code requires taxpayers to furnish their correct TIN to those who require it.

• This section defines how you, the independent contractor, is classified when it comes to federal taxes.
• It does not provide for reimbursement of any taxes, penalties, or interest imposed by taxing authorities and does not include legal representation.
• After reading this brief guide, you should have a clearer understanding of “what is a W-9 form?
• The companies you work with do not have to withholdpaycheck taxesfor you, and the W-9 serves as an agreement that you are responsible for paying those taxes on your own.
• The tax identification number being provided is correct.
• Year-round access may require an Emerald Savings® account.

If you do, you’ll stay on the right side of the law at tax time. Not to mention your business can pay your vendors without worry. That’s something any business owner can get on board https://www.bookstime.com/ with. If you are concerned about giving out your social security number and personal contact information, you can register as a business to avoid sending out personal details.

Do I have to pay taxes if I fill out a W-9?

Year-end earnings are reported in this way, filed with IRS as well as sent to the vendor. The W-9 form aids in determining identifying information for a vendor and it is therefore best practice to request a W-9 from all vendors. Only available for returns not prepared by H&R Block.

UpCounsel is an interactive online service that makes it faster and easier for businesses to find and hire legal help solely based on their preferences. We are not a law firm, do not provide any legal services, legal advice or “lawyer referral services” and do not provide or participate in any legal representation. Form W-9 is typically used to request tax information from freelancers, independent contractors and other self-employed people. Vendors accurately enter their W9 information online through the supplier portal, reducing the accounts payable team’s workload. Members of the accounts payable team don’t need to manually enter paper W9 forms from vendors or constantly follow-up to get completed forms.