Get a W-9 Form From Vendors Before You Write Your First Check

CheckAs you may be aware, as a business owner, you are required to file 1099 forms each year for anyone subject based on the IRS guidelines.  In order to do so, you must have received a W-9 form from the vendor.  This form will give you the legal name that appears on the income tax return, the name of the business (if operating as a DBA), address, and tax identification number.  All of this is information needed to properly file the 1099 returns.  My recommendation is to get this form from your vendor before you ever issue your first check to them for services rendered.

I have seen too many times clients come to us asking for help issuing their 1099 forms.  When we review the vendor list, it appears there are quite a few who should be issued the forms, but we need to verify this against the W9 forms.  When we ask for the forms, they say they never requested these from the vendor.  We tell them they will need to get these forms in order for us to properly file the 1099s.  Although most businesses comply, there are those who don’t ever send in the forms.  This puts our clients in the situation of not being able to file all required forms.  Failing to do so could result in penalties.

Therefore, request a W9 form from EVERY vendor you do business with that is not a public company).  If you are ever audited, you can show the W9 forms and then you are in compliance.  Some may say that with the new 1099K rules where you don’t report any vendors you pay by credit card, it isn’t necessary to do so.  However, there may be a time you pay by check (paper or electronic) and the reporting rules apply.  If you didn’t ask for it when you first began working together, you may not remember to ask for it when you change payment methods.  You could then end up not being able to get it when needed.
Each time you begin working with a new vendor, request the W9 form up front to guarantee compliance.  You’ll be glad you did when the time for 1099 reporting rolls around.