Tax duties are not the same for everyone. There are differences between individuals, companies, workers, etc. For each one, there are specific requirements to declare or provide information to different entities, institutions or even other persons. Particularly, a very requested one for self-employed workers is the W-9 form.
Despite being commonly requested, there are many doubts regarding the reason for its request, to whom it should be delivered, who should fill it out and, above all, how to do it. To end your doubts, in this article, we will address all these questions and answer them as precisely as possible.
In general, it is requested by the Internal Revenue Service (IRS) to calculate the taxes that independent contractors or self-employed workers must pay to the state.
However, if we talk about who requests it directly to the taxpayer, it is his employer. It will be the employer who will give the independent worker the W-9 form so that they can fill it out before starting to work with the company. Otherwise, the company could end up paying the taxes on behalf of the self-employed worker.
Banking or financial entities can also request that they corroborate the self-employed worker's income and ensure that they have acceptable methods and means to pay. Likewise , it can be requested when renting or buying real estate with the same objective to verify.
Because a self-employed person or independent contractor fills out the W-9 form, it is necessary to know what they are. When we talk about them, we refer to people who offer their professional or occupational services to another person, entity, or company without another company.
In other words, the relationship between the independent service provider and the person receiving the service is only between them. There is no type of hiring or remuneration in the form of an employment contract. Therefore, neither enjoys the benefits of a common worker within a company.
For a self-employed person to need to complete and file a W-9 form, they must meet three requirements: Be within the category of an independent contractor or self-employed worker, not work as a full-time employee of the company, and receive a minimum of $600 from the company for the service provided.
Although filling out this form is quite simple and much easier than other forms, it is important to do it carefully to avoid delays in the process.
To begin with, the self-employed person's full name must be entered in the same manner as written on the income tax return in box 1.
If the services are rendered not in the personal name but the name of the business created by the self-employed worker, should fill in box 2 with the business name of the self-employed worker.
Then, you must select the type of beneficiary in the corresponding boxes and check only one. It is also necessary to fill in the address or residence of the taxpayer or business, specifying the city, state and postal zone. In the same way, must enter the taxpayer's employer identification number and social security number.
There is no estimated and mandatory time to update this form. It is enough to ensure that all the data entered is up to date. That is to say; if there is any relevant change to the information corresponding to the form, the idea is to make a new one.
Even if you think you are sure that you have entered the information correctly, double or triple-check all the data entered with as much concentration as possible. Sometimes you may be reading or reviewing something, but if you are thinking about something else simultaneously, you may miss the same mistakes repeatedly.
If you make a mistake with the name , the IRS could understand that your business or you as a taxpayer have not filed the form or filed the appropriate taxes. I don't need to stress the many negative consequences of such situations.
Even misspelling the mailing address would become a huge inconvenience, due to the subsequent sending of supplementary forms for this type of paperwork, to the same mail specified in the W-9.
It is important to emphasize that if you are self-employed, it will normally be provided to you by the company or entity interested in receiving the return form filled out by yourself.
However, it may be useful for employers, who must submit the form, to know that to download it, it is only necessary to search on the Internet for the W-9 form , enter the official IRS website and download it directly from there in PDF format. Subsequently, they can send it by e-mail to the self-employed worker or print it and deliver it in physical form.