Understanding and Completing Form W-9 for Tax ID Requests

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Form W-9, Request for Taxpayer Identification Number and Certification, is the IRS form a business or financial institution uses to collect your legal name, federal tax classification, address and taxpayer identification number (TIN) before it pays you or reports a transaction involving you. You complete it and return it to the requester, not to the IRS. The requester uses it to prepare information returns such as Form 1099, and your signed certification determines whether the payer must hold back part of your payments as backup withholding.

What Form W-9 does

A requester needs your correct name and TIN because it must issue information returns to you and to the IRS. Common ones include:

• Form 1099-NEC for nonemployee compensation paid to contractors and freelancers
• Form 1099-MISC for rents, royalties, prizes and certain other payments
• Form 1099-INT, 1099-DIV and 1099-B for interest, dividends and brokerage proceeds
• Form 1099-S for real estate sale proceeds and Form 1099-C for canceled debt
• Form 1098 for mortgage interest and Form 5498 for IRA contributions

The IRS matches each 1099 against the income on your Form 1040, which is why the name and number on the W-9 must agree with IRS records.

A W-9 is not an employment form. Employees give their employer a Form W-4, which sets payroll withholding. If a company asks for a W-9, it is treating you as a vendor or independent contractor, and no income tax will normally be withheld from your payments.

Who needs to fill out a W-9

The most frequent reason is receiving income outside of employment: freelance or contract work, consulting, speaking fees, royalties or rent paid by a business. You may also be asked for a W-9 in connection with:

• Opening a bank, brokerage or other financial account that pays interest or dividends
• Certain real estate transactions
• Mortgage interest you pay
• Cancellation of a debt you owe
• Contributions to an individual retirement account (IRA)
• Acquisition or abandonment of secured property

Businesses also request W-9s from each other, for example to confirm a corporate or LLC vendor’s tax classification and whether it is exempt from 1099 reporting.

Only U.S. persons use this form. That means a U.S. citizen or resident alien, a partnership, corporation, company or association created or organized in the United States, a domestic trust, or an estate other than a foreign estate. Nonresident individuals and foreign entities provide a Form W-8BEN or another W-8 form instead.

How to fill out Form W-9, line by line

The IRS form runs to several pages, but only the first page is completed and returned. The rest are instructions.

Lines 1 through 7: identification

1. Line 1, Name. Enter your name exactly as it appears on your income tax return, including any middle name or initial you use there. Entities enter their legal name as shown on their return.
2. Line 2, Business name or disregarded entity name. Enter a trade name, “doing business as” name or disregarded LLC name if it differs from line 1. Otherwise leave it blank.
3. Line 3a, Federal tax classification. Check one box: individual/sole proprietor, C corporation, S corporation, partnership, trust/estate, LLC (with a letter showing how it is taxed) or other. If you have never filed paperwork to form a business entity, you are an individual/sole proprietor.
4. Line 3b. Checked only by a partnership, trust or estate that has foreign partners, owners or beneficiaries and is giving the form to a partnership, trust or estate in which it holds an interest. Most payees leave it blank.
5. Line 4, Exemptions. This line holds a numbered exempt payee code for payees exempt from backup withholding and a lettered FATCA exemption code, both listed in the instructions. Individuals and sole proprietors generally leave it blank, and the FATCA code applies only to accounts maintained outside the United States.
6. Lines 5 and 6, Address. Give the mailing address where you want your information returns sent, normally the address on your tax return.
7. Line 7, Account numbers. Optional. A bank or broker may ask you to list account numbers to link the form to them.

The box for the requester’s name and address is also optional, but filling it in gives you a record of who received your information.

Part I: taxpayer identification number

Enter one number, not both:

• Social Security number (SSN) for most individuals. A sole proprietor may enter either an SSN or an employer identification number (EIN).
• Individual taxpayer identification number (ITIN) for a resident alien who is not eligible for an SSN.
• EIN for corporations, partnerships, LLCs taxed as corporations or partnerships, trusts and estates.

If you have applied for a TIN but have not received it, write “Applied For” in this space. The requester may begin backup withholding if you do not supply the number within the time the rules allow.

Part II: certification

By signing, you certify under penalty of perjury that:

• The TIN you entered is correct, or you are waiting for one to be issued.
• You are not subject to backup withholding, because you are exempt, the IRS has not notified you that you are subject to it, or the IRS has told you that you no longer are.
• You are a U.S. citizen or other U.S. person.
• Any FATCA code you entered is correct.

If the IRS has notified you that you are currently subject to backup withholding because you underreported interest or dividends, cross out item 2 before signing. For some transactions, such as real estate transactions, mortgage interest paid and IRA contributions, the instructions do not require a signature, though signing does no harm.

LLCs, sole proprietors and other special cases

Sole proprietor with no LLC. Put your own name on line 1 and any trade name on line 2. Check “Individual/sole proprietor.” Enter your SSN, or your business EIN if you have one.

Single-member LLC (disregarded entity). Unless it elects corporate treatment, the IRS ignores a single-member LLC for income tax purposes, so the owner is the payee. Enter the owner’s name on line 1 and the LLC’s name on line 2. Check the owner’s classification (individual/sole proprietor if the owner is a person), not the LLC box. In Part I, enter the owner’s SSN or EIN, never an EIN issued to the disregarded LLC itself.

Multi-member LLC or an LLC that elected corporate status. Check the LLC box and enter the tax classification letter: C for C corporation, S for S corporation or P for partnership. Enter the LLC’s name on line 1 and its EIN in Part I. A multi-member LLC taxed as a partnership also issues Schedule K-1 forms to its members, separately from the W-9.

Corporations and tax-exempt organizations. A corporation, a 501(c)(3) organization or a government entity checks its classification box and enters the applicable exempt payee code on line 4 if it qualifies. Exemption from backup withholding does not always mean exemption from every 1099; for example, payments to corporations for legal or medical services can still be reportable.

Hypothetical example: Dana runs a graphic design business as “Bright Line Studio LLC,” a single-member LLC that has not elected corporate taxation. Her W-9 shows “Dana R. Lee” on line 1, the LLC name on line 2, the individual/sole proprietor box on line 3a, line 4 blank, her mailing address on lines 5 and 6, and her SSN in Part I. The client’s 1099-NEC then matches the Schedule C on her return.

What happens after you submit

Return the completed form only to the business or institution that requested it, and confirm the request is genuine first, since fraudulent W-9 requests are a known identity-theft tactic. Because the form contains your SSN or EIN, use a secure upload portal, encrypted email, fax or hand delivery rather than an ordinary email attachment.

The requester keeps the form in its records. At year end it uses your information to issue the relevant 1099 or 1098, sending one copy to the IRS and one to you for your tax return. Income is taxable whether or not you receive a 1099.

One W-9 per payer is generally enough. Submit a new one when your name, address, classification or TIN changes, for example after forming an LLC, electing S corporation status or changing your name after marriage, or when the requester asks you to recertify after a TIN mismatch notice from the IRS.

Backup withholding and penalties

If you do not provide a TIN, the TIN you give does not match IRS records, or the IRS instructs the payer to withhold, the payer must withhold 24% of reportable payments and send it to the IRS. That amount is credited against your tax when you file, but it reduces your cash flow in the meantime.

Failing to furnish a correct TIN can bring a $50 civil penalty for each failure unless it was due to reasonable cause. A false statement with no reasonable basis that results in no backup withholding carries a $500 penalty. Willfully falsifying certifications or affirmations can lead to criminal penalties, including fines or imprisonment.

Substitute Form W-9

A requester may use its own version of the form instead of the IRS PDF. Many city governments, utilities, cooperatives, marketplaces and large companies do this, often as an online form in a vendor portal. A substitute form is acceptable if it is substantially similar to the official W-9 and includes the same four Part II certifications made under penalty of perjury.

A requester may add its own questions, such as payment preferences, provided the tax certification remains clear. You fill out a substitute form using the same rules described above.

FAQs

The Bottom Line

Freelancers, contractors, landlords, LLC owners and account holders will all face W-9 requests from payers and financial institutions. Completing the form so your name, classification and TIN match IRS records avoids backup withholding and penalties for an incorrect TIN. Verify each request is genuine, send the form through a secure channel, and submit a new one whenever your name, address, classification or TIN changes.