Key takeaways:

• The W-9 form is used to obtain a taxpayer identification number (TIN) from an individual or business.
• If you're hiring contractors abroad and paying them $600 or more in a tax year for services performed, you'll need to provide them with a 1099 form, and you'll need their TIN.
• The W-9 form is only relevant for contractors who are considered non-employees.

What is a W-9, and when do I need to use one?

The W-9 form, also known as the Request for Taxpayer Identification Number and Certification, is used by businesses to obtain a taxpayer identification number (TIN) from an individual or business. This TIN is used to report payments made to the individual or business on a 1099 tax form.

If you're hiring contractors and paying them $600 or more in a tax year for services performed, you'll need to provide them with a 1099 form. But first, you'll need their TIN, which is where the W-9 form comes into play. By having the contractor complete a W-9 form, you'll obtain their TIN, which you can then use to accurately report the payments made to them on a 1099 form.

It's important to note that the W-9 form is only relevant for people who are considered non-employees. If the individual you're hiring is considered an employee, you'll need to obtain their TIN using a W-4 form instead.

Do I need a W-9 from contractors in other countries?

No. If you’re hiring abroad, you’ll likely need to collect Form W-8BEN, which replaces the W-9 for contractors that don’t live in the United States.

Bottom line? The W-9 form is essential if you’re hiring contractors in the United States. By understanding its purpose and importance, you can take the necessary steps to ensure that your business is in compliance with tax regulations. If you have any questions or concerns about the W-9 form, it's always best to consult with a tax professional for guidance.

Hiring contractors? Thera can save you a ton of time

You don’t need to issue W-2 forms to your contractors. But, if you are hiring contractors, you’re probably spending too much time on their payroll, contracts, and tax documents. Which is why we built Thera, which saves you 90% the time you spend on contractor paperwork each month.

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