What Is a W-9 Tax Form?

 

Editor’s Note: A W-9 is a common tax form many American taxpayers need to fill out each year. Learn more about the W-9 form meaning, examples of W-9 income, and other terms associated with this form here.

What is a W-9?

Taxpayers use the W-9 tax form to verify their correct taxpayer identification number (TIN) and to certify that they are not subject to backup withholding.

w-9 tax formThe form, officially called Form W-9, Request for Taxpayer Identification Number and Certification, is typically used when a person or entity is required to report certain types of income paid to the taxpayer.

What Are Examples of W-9 Income?

Examples of the types of income paid include:

  • Dividends
  • 1099-MISC income
  • Stock and mutual fund sales and broker transactions
  • Real estate transactions
  • Mortgage interest the taxpayer paid
  • Acquisition or abandonment of secured property
  • Cancellation of debt
  • Contributions the taxpayer made to an IRA

If a taxpayer fails to certify their TIN and backup withholding status on IRS Form W-9, or similar statement, backup withholding may begin immediately.

IRS W-9 Form Terms

If you’re required to complete an IRS W-9 form, you may come across terminology with which you are not familiar. Review the list below for explanations to a few common terms found on this form.

  • Taxpayer Identification Number (TIN) – For individuals, this is generally your social security number (SSN), but it can be an individual taxpayer identification number (ITIN) if the taxpayer doesn’t have an SSN. Business entities will complete the form using their employer identification number (EIN).
  • Backup Withholding – This is a percentage of income that is held from the taxpayer’s payments received and is remitted to the IRS. Backup withholding may apply when a taxpayer has not met TIN certification requirements or if they previously did not report income correctly to the IRS.
  • Exemptions – This section of the W-9 tax form applies only to certain entities, not to individuals. Entities that are exempted from backup withholding should enter the appropriate code found in the Instructions section. Nonresidents do often complete W-9 to tell the requester that they are exempt from withholding due to treaty or other payments that are exempt from federal withholding. You could have a whole different article about completing these forms for nonresidents.

W-9 Tax Form Questions

For additional W-9 tax form details, you can review the Form W-9 Instructions, which are included with the IRS W-9 form on its website.

Do you have additional questions about IRS Form W-9 or need help filing your return? Our tax pros speak the tricky language of taxes and are committed to helping you better understand your return. Make an appointment with one of our tax pros today.

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