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Best Practices for filling out W-9 Forms
Whenever you get a new job, it can be easy to get lost in the new paperwork thrown your way. With agreements, offer sheets, company statements, etc., it can be easy to get lost in the madness. One of the most important forms that is filled out on the employee side is the W-9 form.
The W-9 form is an official IRS tax form that you fill out to verify your name, address and tax verification information for the income you receive. The information taken from the W-9 directly relates to how you receive your 1099 tax form which becomes important when it comes to tax-filing season. With it comes the TIN, or, your Tax Identification Number.
As an HR professional or new employee, here are some best practices to follow:
Filling out the form entirely
If it isn’t obvious already, filling out the entirety of the form is critical. Making certain that your name, address and social security number are present and accurate are key in making sure that your identity is verifiable. There are two main purposes for the form being completed. One of them being to confirm your identity, the other to make sure vendors are held accountable. This makes it so that vendors that aren’t reporting income, will get caught by the IRS.
Filling it out in a timely fashion
The IRS requires that you obtain a W-9 form from a vendor by the time you file your tax returns, but its better to get them before you make the payment to the vendor. So typically, this is done at the very beginning of a hiring or contracting process.
This is one of the onboarding forms that often gets lost in the mix. With different tax systems in companies, there can be some small different procedures. However, most of the time there is a lot of paperwork involved to legitimize the process.
Keep track of all different forms
Often if you are a contract worker or are on the flip-side and hire a lot of contract workers – you should take note of how many different forms are being processed. Whether its a W-9 or a 1099, they are essential for tax purposes.
If you are a contract worker and have worked many different contract jobs, you have to keep your forms in one place. Keeping track of them throughout the year makes it easier to find when it comes time to file your taxes. On the other hand, employers or HR professionals should keep their 1099s ready for when January comes around.
Under the W-9 forms, the companies will not withhold any taxes for you. You are the one that has to be responsible when it comes to ensuring the right amount of taxes are paid. So get your W-9 forms in order and organized ahead of time, and save yourself the hassle later!