Form W-9 (Request for Taxpayer Identification Number)
A form used by businesses to collect a contractor or vendor's name, address, and Taxpayer Identification Number for 1099 reporting purposes.
Detailed Explanation
Form W-9 is provided by US persons (individuals, sole proprietors, partnerships, LLCs, corporations) to businesses that will issue them a Form 1099 (typically 1099-NEC for nonemployee compensation of $600 or more in a year). The form certifies the taxpayer's name, TIN (SSN or EIN), tax classification, and exemption status. Foreign payees use Form W-8 series instead. W-9 is not filed with the IRS but retained by the requesting party.
Key Points
- Used to collect a US payee's legal name, TIN (SSN or EIN), and tax classification for 1099 reporting.
- Not filed with the IRS; the requesting business retains it on file.
- Foreign payees instead provide the appropriate Form W-8 series.
- A payer that lacks a valid W-9 may be required to apply 24% backup withholding.
- Best practice: collect a W-9 before paying any new vendor or contractor.
Practical Example
A business hires a freelance designer and will pay her $5,000 during the year. Before issuing the first payment, the business requests a Form W-9 to capture her name and SSN. At year end it uses that information to file a 1099-NEC. If she had refused to provide the W-9, the business would have had to withhold 24% backup withholding from her payments.
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Learn about Business Tax PreparationRelated Terms
Form 1099 (Information Returns)
A series of IRS forms used to report various types of non-employee income, including 1099-NEC for contractor payments and 1099-K for third-party payment processors.
Self-Employment Tax
The Social Security and Medicare tax (15.3% combined) paid by self-employed taxpayers on their net earnings from self-employment.
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