What is a W9 form? This is a question that will get asked more often as 15.5 million people work as independent contractors in the United States. If the idea of breaking free from the corporate world and working for yourself sounds enticing, then you need to get familiar with this tax form.
This isn’t a form that you need to turn into the IRS, though. Keep reading to learn how you’ll use this form in your career as an independent contractor.
What Is a W9 Form?
The W9 form is an IRS document that businesses can use to request identifying information from another company or independent contractor. The information obtained on the W9 can then get used to creating a 1099-MISC form.
Most companies won’t ask you to fill out a W9 until they know they will pay you over $600. This is the threshold for reporting payments to the IRS.
How to Fill out a W9 Form
The first thing you need to do is download the correct version of the form. The best way to know you have the latest and accurate version of the form is to download it from the IRS website. Then you’ll need to have some information.
On the first line, you’ll enter your full legal name that you use to file your taxes. The name on your federal income taxes should match the name you write on this form.
If you’re filling out the form on behalf of your business, then fill that out on the second line. This will ensure that the payment gets attributed to your business income and not your personal income.
The next step is to select your tax classification. For more independent contractors, the correct choice is “Individual/Sole Proprietor”. Then enter your mailing address.
You’ll need to enter your TIN, SS, or EIN. If you are a citizen with a Social Security number, enter this number. If you’re a nonresident alien and don’t have a Social Security number, then you should enter your TIN. Businesses should enter their EIN.
The final step is to sign and date your form.
Submit Your W9
Once the form is complete, you need to turn it into the person requesting it. They will keep a copy of this form in their files as a reference for their end of the year accounting. They will use the information on your W9 to create your 1099-MISC form through their paystub service, such as PayStubs.net.
Get Your Tax Documents Ready
With the end of the year quickly approaching, you aren’t the only one asking, what is a W9 form? The good news is that you now know the answer.
If you have your own business or work as an independent contractor, you can expect other companies to ask you to fill out a W9 form.
Check out the business section of our blog for more helpful articles to make your business a success.