The Internal Revenue Service has many tax forms that taxpayers must use to complete other forms. Form W-9, the Request for Taxpayer Identification Number Form is one of them. Generally, when a company hires a freelancer or a contractor to work for them, they must detail it on Form 1099-MISC if the amount paid exceeds $600.
Then, the contractors can use their 1099-MISC to file their tax returns. It works the same way as Form W-9 but for self-employed individuals.
To complete Form 1099-MISC correctly, the companies need the correct taxpayer identification number of the contractor or the freelance. The part of Form 1099-MISC where it asks to detail the taxpayer identification of the recipient can be seen below. If you’re a freelancer or a private contractor, we recommend keeping completed Forms W-9 on your behalf and give it to the potential requesters. Since this is only for amounts paid to you over $600, you can know who to give a W-9 and who not to give.
Keep in mind that the Taxpayer Identification Number can only have the last four digits of it. This is to protect any fraud or misuse of both the payer and the recipient’s Social Security Number.
Use of Form W-9 in Other Cases
Other than business, Form W-9 can be used in a few other cases although it isn’t popular. For example, if you’re the beneficiary of a life insurance holder, you may be asked to complete a Form W-9 before receiving the death benefit. You can learn more about this here.
Regardless of what purpose the W-9 is requested, filling out the request for taxpayer identification can be completed within minutes. As far as the information found on Form W-9 goes, you only need to detail your full name, business name (only if different than the name), tax classification of the business, address, and Social Security Number or the TIN.