What is a W-9 form?
Find out everything you need to know about W-9 forms, what they are, how to fill them out, and what to look out for.
Getting your head around a W-9 tax form doesn’t have to be as confusing as you might expect. This article outlines what this form is, its purpose, and how you can quickly and easily fill it out if required. Seamless tax management is a must for less stress; we’re here to help with that.
What is a W-9 form?
First things first, what is a W-9 form? A W-9, or ‘Request for Taxpayer Identification Number and Certification,’ is an IRS tax form. It’s most commonly used by businesses who want to confirm the details of an income-earning self-employed worker (contractor, vendor, etc.), though there are some other cases where it might be used.
A W-9 can be completed on paper or electronically, provided a paper copy could be submitted to the IRS on request. It asks for the following details about a taxpayer:
Their TIN (Taxpayer Identification Number—usually their Social Security Number, but could also be their Employer Identification Number)
What’s the purpose of a W-9 form?
A W-9 form doesn’t get sent to the IRS directly. It’s an information return. Usually, US employers ask their self-employed workers to fill it out so they can gather the correct information and refer to it when filing other important documents with the IRS later (like Form 1099-NEC for self-employed freelancers who earned over $600 that tax year).
Less commonly, a W-9 might be requested by a financial institution, either to gather vital information about a new customer or to submit a type of 1099 form for things like real estate transaction proceeds and interest income. Real estate businesses may also sometimes request that tenants complete a W-9, as it’s a method of safely gathering and storing information.
Do I need to fill out a W-9 form?
Understanding your tax responsibilities is essential for proper financial management and planning. If you’re asked to provide a W-9 form, you will most likely face issues and penalties if you don’t.
For example, if you’re a self-employed contractor earning income from a company, failing to provide a W-9 when one has been requested can lead to something known as ‘backup withholding.’ This is when a percentage of income is withheld from an earner by their payer and passed onto the IRS, and it occurs if a taxpayer fails to supply a correct TIN.
By not completing the W-9, you could fail to supply this TIN and face this issue. For 2018–2025, the withheld income percentage is 24 per cent.
Several penalties are also applied to non-compliance, including failure to provide a W-9. Every instance of non-compliance could cost $50, and civil penalties for providing incorrect or non-timely information can be up to $530.
How to fill out a W-9 form
Write your name on line one (as it appears in your tax return).
Write your business or ‘disregarded entity’ name on line two (if it differs from your name).
On line three, select what you are for federal tax classification. Check box one if you’re an individual, a sole proprietor or a single-member LLC. Check another applicable box if you’re filing for an LLC with multiple members, a C Corporation, an S Corporation, a Partnership, a Trust, or ‘Other’ (provide details on this if you fall into the ‘Other’ category).
Line four is for exemptions. Businesses or entities must provide number or letter codes if they qualify for any exemptions relating to backup withholding or to Foreign Account Tax Compliance Act (FACTA) reporting requirements.
Line five requests your address—street and property number or name. Line six requests the rest of the address—city, state and ZIP code. Be sure to use the address on your tax return to avoid discrepancies.
Line seven is an optional space where you can leave any account numbers that the recipient of your W-9 might need from you.
To the right of lines five, six, and seven, there’s an optional space to list the name and address of the person/entity requesting the W-9 from you. You may find this section helpful if you hope to keep a clear record of the people/businesses to whom you’ve given your TIN.
Part I, ‘Taxpayer Identification Number (TIN),’ asks for precisely that, giving you space to fill in the relevant number on the right. If you’re an individual, this will usually be your Social Security Number (SSN). For other entities, it will be your Employer Identification Number (EIN). Sole proprietors with an SSN and an EIN may enter either. Resident aliens should enter their Individual Taxpayer Identification Number (ITIN) in the SSN box.
Part II, ‘Certification,’ is a declaration that you’ll need to read in full and then attest to the truthfulness of by signing your name in the indicated box and dating the W-9 form. The statements in the Certification are confirmed under penalties of perjury.
Where to get a W-9 form
If you’re not sure where to find a W-9 form, we can point you in the right direction. The current revision of the W-9, last updated in October 2018, is available on the IRS website as a downloadable PDF.
As mentioned at the start of this article, these forms can be submitted digitally or on paper. The most secure way to provide a W-9 is to hand the form in directly in person. If you can’t, consider using a free online service to encrypt your completed form and email it securely to the person requesting it. This will provide even more of a guarantee of safety than posting your form via FedEx or UPS.
On the subject of security, ensure you take the time to ask how your W-9 will be stored once it’s been received. And never send a W-9 to a company or institution you don’t trust 100 per cent without seeking further advice from a tax professional.
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Kate has written for leading publications and blue chip companies over the last 20 years.