Therefore, before starting any work with a person or business, be sure to ask for a Form W-9 if they haven’t already provided you with one. Failing to do so could prove troublesome after beginning the work. When you begin working with a contractor or freelancer that you will be paying, you should request that he or she complete a Form W-9 prior to starting any engagement. When it’s for your business, the taxpayer identification number (TIN) is your employer identification number, or EIN. TurboTax Tip: If you submit the W-9 as an individual, your TIN is usually your Social Security number. The individual or business you are doing business with uses the W-9 to collect some of your personal information, the most important of which is your taxpayer identification number (TIN). You will usually submit a W-9 form when you engage with a company where reporting information to the IRS might be necessary, such as receiving payments for services you provide as an independent contractor, paying interest on your mortgage or even contributing money to your IRA account. Likewise, banks, brokerage firms and other payers typically ask for a completed W-9 to prepare your 1099s to report items such as interest, dividends, cancellation of debt and more. TurboTax Tip: Companies who engage you as a contractor or make payments to you for services you provide will likely ask for a completed W-9. That person keeps the form on file and uses this information to prepare other returns, such as 1099 Forms and 1098 Forms, as well as to determine whether federal tax withholding is necessary on the payments you receive.
However, the requester has no obligation to file the W-9 with the IRS. The person or business paying you is responsible for requesting the W-9 Form from you. You will usually submit a W-9 when you engage in most taxable transactions that need reporting to the IRS.The person or business you do business with uses the W-9 to collect some of your personal information like your name, address and taxpayer identification number (Social Security numbers for individuals and employer identification numbers, or EINs, for businesses).Form W-9 provides personal identifiable information to a person or business used for reporting income paid to individuals such as self-employed people like independent contractors, freelancers, vendors or other customers.And, if you hire independent contractors in your business you likely should ask for completed W-9 forms from these people. If you do business with a company that pays you as an independent contractor, freelancer or gig worker (in other words, self-employed), or will be paid income such as interest or dividends, a company may request that you fill out and send a W-9 so they can accurately prepare a 1099 form, report the payments they make to you at the end of the year and know whether or not you are subject to backup withholding.
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