How to Fill out a W-9 Form
The W-9 form is an IRS tax form that is filled out by providing information about a freelancer or contractor including the name, address and taxpayer identification number (TIN). The business that employs freelancers and contractors uses the information to prepare Form 1099-MISC and report to the Internal Revenue Service the amount of income that is paid to the contractor or freelancer.
This form enables businesses to get key information about the vendor or contractor. If you’re a contractor or freelancer, this form is an agreement that you are responsible for paying your own income tax and contributing to Medicare and Social Security on your own.
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NOTE: FreshBooks Support team members are not certified income tax or accounting professionals and cannot provide advice in these areas, outside of supporting questions about FreshBooks. If you need income tax advice please contact an accountant in your area.
Who Is Required to Fill out a W-9?
The W-9 form must be filled out by self-employed workers such as independent contractors, vendors, freelancers and consultants. This form allows businesses to keep track of their external workforce. As a contractor or freelancer, you may have completed jobs for multiple businesses. This means that you may have to fill out multiple W-9 forms in the year.
Apart from freelancers, professional consultants, trade workers and independent contractors, the W-9 tax form has to be completed for any income earned on mortgage interest paid by individuals, specific real estate transactions and dividends paid out to shareholders.
For the 2018 tax year, a 1099 tax form is only required for payments exceeding $600. Income under $600 must still be included only on an individual’s annual tax forms.
What Is a W-9 Form Used For?
The W-9 form is an Internal Revenue Service tax form that is used by independent contractors and other self-employed workers that signals the taxpayer is not subject to backup withholding and is responsible for paying his or her own taxes. It also serves as a guide in completing a contractor’s tax obligations for the calendar year.
Since companies that hire independent contractors don’t withhold income taxes and FICA taxes, it’s up to the self-employed individuals to meet those IRS tax obligations.
How to Fill out a W-9?
- Print your name or business name in the space where it says “Name.” The name must match the name shown on your tax returns
- Check the box for “Individual/Sole proprietor” if you have not filed your taxes as a corporation, partnership or LLC
- Check the box for “Exempt payee” only if you are positive that you are exempt from backup withholding. The qualifications appear on the form under “Specific Instructions, Exempt Payee”
- Enter your current address in the space provided
- Enter your Social Security number in the space provided. This is your taxpayer identification number (TIN)
- Then sign and date the W-9 form. When you’re finished, provide the form to company or individual who issued it. Do not send the W-9 to the IRS
How Do You Fill out a W-9 Form for an LLC?
- A single-member Limited Liability Company is considered a disregarded entity by the Internal Revenue Service for federal income tax purposes. In this case, the sole member of an LLC must file taxes in the same way that sole proprietors do.
- Enter your name and the legal name of your limited liability company (LLC) on the first two lines of the W-9. On the first line, write the name you file your tax returns under and on the second line, enter the legal name of the LLC
- Enter business address, city, state and zip code
- Check the “Individual/sole proprietor/single member LLC” box – not the “limited liability company” box for your tax classification
- Enter your Social Security number. You must ideally use your SSN. However, the IRS allows you to enter an employee identification number (EIN) that you’ve obtained in your capacity as a sole proprietor
- Sign the certification and submit the W-9 form to the requester
Corporation or Partnership
If the LLC is a corporation or partnership, follow the steps below:
- Enter the name of the LLC as recorded in the tax documents. If the LLC has a secondary business name, enter it on the second line, “Business Name”
- Check the “Limited Liability Company” box
- On the tax classification line, write a “P” for partnership, “S” for S Corporation, or “C” for the corporation
- Enter the business address, city, state and zip code
- Enter the employer ID number of the LLC
- Sign and date the W-9 and submit it to the requester
Freelancers and contractors must fill out the W-9 form for every client that they’ve worked for. To stay on the safe side, save a copy of the W-9 form for your own records. You can use it to contact a client if you are missing the 1099-MISC come tax time.