What Is Form W-9: Request for Taxpayer Identification Number (TIN) and Certification?
If you operate as a freelance professional or an independent contractor, it is common for your clients to request that you fill out Form W-9, which stands for Request for Taxpayer Identification Number (TIN) and Certification. This form serves as a crucial tool for businesses to gather essential details from their vendors, enabling them to prepare information returns for the IRS. Businesses are required to file information returns using Form 1099-MISC when payments to a freelancer or independent contractor total $600 or more annually.
Clients utilize the information provided on your W-9 to populate the 1099-MISC form, including your name, business name, address, and taxpayer identification number. It is vital to note that one copy of the 1099-MISC is submitted to the IRS, while another is dispatched to you in late January following the conclusion of the tax year.
When Form W-9 Is Needed
A W-9 may be required for various purposes, including certain real estate transactions, mortgage interest payments, acquisition or abandonment of secured property, cancellation of debt, and contributions to an individual retirement arrangement (IRA). Form W-9 serves as a means to collect tax information from U.S. persons, including resident aliens, partnerships, corporations, companies, estates, and domestic trusts.
How to Complete Form W-9
Form W-9 is a relatively straightforward IRS form to fill out. However, if tax forms seem daunting, fret not. We will guide you through the correct procedure for completing it.
**Step 1:** Enter your name as it appears on your tax return.
**Step 2:** Provide your business name or the name of your “disregarded entity” if different from the name in Step 1. For instance, if you have a sole proprietorship but use a different name for marketing purposes, you will enter that name here.
**Step 3:** Select your federal tax classification from options such as sole proprietorship, partnership, corporation, limited liability company, etc.
**Step 4:** Leave exemptions blank unless applicable.