Form W-9: Request for Taxpayer Identification Number and Certification
A W-9, formally titled the Request for Taxpayer Identification Number and Certification, is an official Internal Revenue Service (IRS) form used to collect your tax identification number (TIN) and verify your tax filing status. It's essentially a way for businesses and other entities to ensure they have accurate information for reporting income they pay to you.
Who Needs to Complete a Form W-9?
A. Businesses and Individuals: Any business or individual that makes payments exceeding $600 in a year to a person or entity that is not a regular employee (someone receiving a W-2 form) needs to have them complete a W-9. This includes payments for services rendered, rent, prizes, and awards.
B. Independent Contractors and Freelancers: If you are an independent contractor, freelancer, or vendor working with a company and expect to receive payments exceeding $600 in a year, you will likely be asked to complete a W-9 form.
What Happens After Completing Form W-9?
Once you complete and sign the form, the requesting party will use your TIN to file the appropriate information return with the IRS. This helps ensure accurate tax reporting and avoids potential tax issues for both parties.
Do I Need to Complete a W-9?
You'll need to complete a W-9 if you're an independent contractor, freelancer, or vendor receiving payments exceeding $600 from a business or if requested by a financial institution or during a real estate transaction.
What if I Don't Have a TIN?
If you don't have a Social Security number (SSN) or Employer Identification Number (EIN), you should apply for one. For individuals, you can apply for an SSN using Form SS-5 at your local Social Security Administration office. Businesses can obtain an EIN by applying online through the IRS website or by mail using Form SS-4. If you're waiting for your TIN, you can write "Applied For" in the designated space on the W-9 and submit the completed form.
Is There a Deadline for Completing Form W-9?
There's no specific deadline to complete the form itself. However, if you're an independent contractor, it's best to complete it promptly to avoid delays in receiving your payments. Additionally, if you don't provide your TIN within 60 days for certain types of income (like interest or dividends), you might be subject to backup withholding, where the payer withholds a portion of your income for tax purposes.
Is My Information on Form W-9 Secure?
The information you provide on Form W-9 is subject to strict privacy regulations. The requesting party can only use it for tax reporting purposes and cannot disclose it for any other reason.
What Happens if I Don't Complete a W-9?
If you fail to complete a W-9, the payer may be required to withhold a higher percentage (24%) of federal income tax from your payments. This withheld amount is not refundable until you file your tax return.