When do I need to request a Form W-9 from a vendor?

If you are hiring an independent contractor to provide or complete a service, we recommend that you request a copy of a signed Form W-9 prior to that contractor beginning the project. (It is also advisable that you obtain a copy of the contractor’s Workers' Compensation/General Liability insurance policy.)

Although incorporated vendors do not require a 1099 to be issued at year-end (i.e., C-Corps and S-Corps), it is still within your right to request a W-9 from these types of vendors. You may also choose to issue them a 1099.

Two common reasons why requesting a W-9 from ALL vendors is a smart decision:

1. A signed W-9 confirms, under perjury laws, that the signer is providing accurate information regarding their entity type, federal tax classification, and Taxpayer ID Number (TIN). A vendor can say that they are incorporated, and that they do not need to provide a W-9 or receive a 1099 at year-end, but that is not always accurate.

2. Many people confuse vendors with an “LLC” designation as incorporated. The “LLC” tag refers only to a company’s ability to separate personal liability from liability arising as a result of business operations. Any of the following entity types may be designated as an LLC, in addition to their federal tax classification:

  • C-Corporation (incorporated)
  • S-Corporation (incorporated)
  • Partnership

Disclaimer: This information is provided as a self-help tool and does not constitute legal or financial advice. Laws, regulations and lending products are changing daily and decisions as to whether or how to use this information and/or what actions to take are solely those of the employer. The providers of this information disclaim any and all responsibility and liability for its accuracy, completeness or fitness for your particular business purposes.