W-9 Form
Published on September 27, 2024
by Aya Takriti, EA
Aya Takriti, an IRS Enrolled Agent with 10 years of expat tax experience, specializes in US tax preparation, tax planning and tax advice for US citizens and Green Card holders living and working in the Middle East.
Table of Contents
Why do I need to submit a W-9 Form?
A W-9 Form is used to provide your correct Taxpayer Identification Number (TIN) to the person who is required to file an information return with the IRS.
This form can verify personal information like your name, address, and Social Security Number (SSN) for individuals or Employer Identification Number (EIN) for businesses.
Who is required to complete a W-9 Form?
For individuals, anyone who will receive income as a non-employee:
- Freelancer
- Self-employed individuals
- Independent contractors
- Temporary or gig employees under non-employment structures
- Individuals receiving interest or dividends from investments
This is for businesses providing another service for an entity or engaging in financial transactions.
NOTE: W-9 is made for individuals who are US citizens or residents.
What if I’m not a US citizen?
You can submit a W-8 Form instead of the W-9 Form.
I want to know more about US taxes abroad
How do I complete a W-9 Form?
Here’s a guide to completing a W-9 Form:
- Line 1. Name: Enter your full legal name as it appears on your tax return.
- Line 2. Business Name: Only if you classify as a business or use a different name. If not, leave it blank.
- Line 3a. Tax Classification: To clarify your current status, like an individual, sole proprietor, or corporation.
- Line 5 and 6. Address: Provide the mailing address where you wish to receive tax-related documents. This is also the address where the requester of Form W-9 will mail your information returns.
- Line 7. Social Security Number (SSN) or Employer Identification Number (EIN): Enter your SSN for individuals and EIN for businesses.
- Signature: Sign and date the form to confirm everything is correct.
What mistakes should I avoid when filling out a W-8 form?
- Ensure that the name you entered is the same as your income tax return identification.
- Incorrect or missing Social Security Number (SSN) or Employer Identification Number (EIN).
- Incorrect tax classification. The IRS has provided a summary table for guidance as part of the instructions on Form W-9.
- Not signing the form is considered incomplete. Always sign and date it.
If you submit a W-9 form incorrectly, you must notify the requester and complete a new form as soon as possible.
Where do I submit a W-9 form?
You need to submit the form to the person or business that requested it from you, not the IRS. Since the W-9 form is intended for the requestor, payments made to you to the IRS.
To protect your sensitive information, avoid sending the form via email. It’s always better to fax or mail it. A requestor can face legal consequences if they share your personal information without permission.
What happens if I don’t submit a W-9 form?
Failure to submit a W-9 form automatically causes the requestor to take 24% of payments made to you as instructed by the IRS.
Backup withholding
Backup withholding is used by the IRS to collect a percentage of your reportable income to ensure compliance with paying taxes.
This is triggered when you fail to submit a W-9 form or incorrectly submit a W-9 form.
The current backup withholding rate is 24%.
Not submitting a W-9 form when needed could also lead to other issues, such as delayed income or tax penalties.
Can I be exempt from backup withholding?
Yes, you are generally exempt if you have provided the correct information on your W-9 form and it matches the IRS records.
Some types of income are not subject to backup withholding:
- Wages or salary
- Retirement account distributions
- Unemployment compensation
- Real estate transactions
- Interest and dividend payments
How long is my information on the W-9 form valid?
The W-9 form remains valid as long as the information provided is correct and up-to-date.
If you decide to change your personal information and it connects with the W-9 form, you need to submit a new W-9 form to update your details for the benefit of the requestor and the IRS.
If you submitted a W-9 a long time ago, it’s a good idea to check with your payer to ensure the accuracy of the details.
How do a W-9 Form and a W-4 Form differ?
A W-9 form is for freelancers, independent contractors, or anyone who gets paid but isn’t an employee. It provides the person or company paying the individual with correct taxpayer information.
A W-4 form is for employees. It tells their employer how much tax to withhold from their paycheck.
How do a W-9 Form and a 1099-MISC Form differ?
A W-9 Form is requested by businesses to collect tax information from non-employees they are paying like independent contractors and freelancers for tax reporting.
A 1099-MISC Form is used by businesses to report payments made to non-employees to the IRS for the taxable year.
In summary, the W-9 form collects information on non-employees, and the 1099-MISC form reports payments of non-employees to the IRS. The two forms work together.
