What Is a W9 Form?

The W9 form is an Internal Revenue Service (IRS) form that businesses use to collect key financial information from their independent contractors. A W9 is required to be completed by anyone claiming tax exempt status from the IRS and is used for verifying an individual’s taxpayer identification number, or TIN, which is then used for preparation of the 1099-MISC form. It is important that the information submitted in the W9 be accurate as it is used to measure the amount of tax withheld and paid to the independent contractor.

What Information Does a W9 Form Ask For?

The W9 form includes a range of information including the first and last name of the contractor, their mailing address, Social Security or tax identification number, and the type of business they are engaged in (for example, sole proprietorship or C corp). It also includes a short description of the services you requested from the contractor and fields in which to indicate your company’s legal business name and mailing address.

When Is a W9 Form Required?

A W9 form is generally required when any person or company makes a payment to an individual or unincorporated business: This typically includes independent contractors, freelancers, and subcontractors. The W9 form is not required for payments made to corporations.

Why Is a W9 Form Important?

A W9 form is an important document for tax compliance and record-keeping purposes. The information requested in the form is required to correctly report taxable payments to the IRS. It also allows for employers to have accurate records of all contractors they have worked with throughout the year.

What Happens if A W9 Form Is Not Filled Out?

If a W9 form is not filled out by an individual or business, they may be subject to penalties and fines from the IRS for failing to provide their correct information. Furthermore, the business that was supposed to collect this information may be required to submit backup withholding for any payments made to the individual or business.