How to fill out an IRS Form W-9

Form W-9 is a common tax form requested by the IRS for those who are self-employed. This form is most often used when someone works as an independent contractor for a company or as a freelancer, although it is used in other situations as well.

If you are asked to complete this form but don’t know how to do it or have any questions about it, don’t worry. Here we explain how to fill out the form W-9 step by step.

What is the Form W-9?

As we mentioned before, the W-9 form is an IRS document used to accurately estimate the taxes owed by contract workers in a given tax year. The purpose of this form is to help businesses obtain important information from payees for informational reporting to the IRS.

If you are self-employed, a client may request that you complete and submit a W-9 form so that they can accurately prepare your Form 1099-NEC, report the payments made to you at the end of the year and know whether or not you are subject to additional withholding.

Who needs to complete W-9 form?

If you are an independent contractor, self-employed service provider, or a company that provides services to another company and you pay your self-employed employee more than $600 a year, you should request your employee to fill out the W-9 form.

On the other hand, you may be required to submit this form when buying or renting an apartment. Also, financial institutions, such as banks, may ask you to complete the Form W-9 to report to the IRS the amount of money you receive for interest. They can also ask you for this document when you need to open a bank account, apply for a loan or a credit card.

When should you ask for a W-9 form?

Before you start working with a contractor or freelancer, you should ask him or her to complete a W-9 form.

As an employer, you can download the form for your employees to fill out and send it to you with their data, by going to the official IRS website. To go directly to the website and download the form, click here.

How to fill out a Form W-9 step by step

If you’ve been asked to fill out a W-9 form and need help, don’t worry. Completing this document is very easy and here we explain how to do it.

Line 1 – Name

If you are completing your W-9 form as an individual, enter your full name on line 1. Remember to enter your name as it appears on your tax return.

If you applied for an individual taxpayer identification number (ITIN), enter your name exactly as you entered it on your Form W-7 application, line 1a, and on Form 1040.

If you are completing the form as a sole proprietor or single member LLC, enter your name as it appears on your 1040/1040A/1040EZ. But if entering as a partnership, multi-member LLC, C corporation, or S corporation, enter the name as it appears on the applicable tax return.

Line 2 – Business name

If completing your W-9 form as a business, enter your business name on line 2.

Line 3 – Federal tax classification

In this section you must check the box corresponding to the federal tax classification for the name entered on line 1. Remember to check only one of the boxes that appear in this section.

Line 4 – Exemptions

If completing Form W-9 as an individual, you can skip this line and go to the next section.

This line is for exemption codes, which apply to those payments that are exempt from backup withholding.

If you think your business is exempt from backup withholding, see the instructions provided on Form W-9 for the appropriate code to use.

Lines 5 and 6 – Address

Enter your address, city, state, and zip code on lines 5 and 6. If you already provided an address and this is a new address, write “new” at the top.

Line 7 – Account number

This line is optional. Some companies have multiple accounts with a vendor and this line is available to specify which account the W-9 belongs to.

Part I – TIN

Enter your tax identification number (TIN) in this section. If you are completing Form W-9 as an individual, this will be your Social Security Number or single-member LLC.

If you are entering as a multi-member LLC classified as a partnership, C Corporation, or S Corporation, you may include your employer identification number (EIN).

If you are a sole proprietor, you can include any number.

In case you live in the United States as a resident alien, you can use your ITIN from the IRS.

Part II – Certification

Finally, you should sign and date the form in this section. By doing this, you declare that the information provided in the form is correct.

Frequently Asked Questions

How often do I have to update the W-9 form?

The IRS requires that you update your W-9 form any time there are changes to your personal information, whether it be your name or business name, address, Social Security Number (SSN) or Employer Identification Number (EIN), etc.

What happens if I don’t submit the W-9 form?

If you do not report your income and must pay taxes on it, you will be subject to a series of penalties that will increase the amount owed.

What should I do if I receive a W-9 form by mistake?

If you receive a W-9 form by mistake, it is probably from fraudulent entities or individuals. In case you receive a form from a suspicious source, or if you have any questions about it, please contact a tax specialist to solve this problem.