One of the forms issued by the United States Internal Revenue Service (IRS) is Form W-9 (sometimes written as Form W9). This type of form is used for taxation purposes although it is not filed with IRS. The Form W-9 is collected by companies who hire independent contractors, otherwise known as freelancers. This particular form is also used by financial institutions to declare their earnings. The Form W-9 is not given to employees.
The Form W-9 is given to independent contractors in order to get information. Among the data that the form asks for is the freelancer’s name, address, social security number and tax payer identification number. The contractor can use a substitute Form W-9 if it is more or less similar to what is inside Form W-9 itself. The IRS provides specific instructions for this.
The company, upon getting the Form W-9, will have the responsibility to produce a Form 1099 based on the information that they got from the Form W-9. Form 1099 will detail the earnings received by the independent contractor from the company for the tax year. Copies of the Form 1099 are given to both the IRS and the independent contractor. There are some states that will require a separate mailing of the form.
The Form W-9 does not authorize the company to withhold the tax from the contractor’s paycheck. Neither does it give them the right to deduct taxes or social security payments. The independent contractor has the responsibility of paying the full amount of the taxes and making the social security payments.