IRS Tax Form W-9 ExplainedPublished:
The W-9 federal income tax forms are filled out by people who have done work for a company, but not as an employee. Companies who hire people such as freelancers or independent contractors to do outside work are still required to report these non-employee’s wages to the IRS. Employers get all the information that the IRS requires by asking these independent contractors or freelancers to fill out W-9 federal income tax forms.
Are you concerned you might have to fill out one or more W-9 federal income tax forms? The list of outside workers that need to fill out these particular tax forms is small. So, you may not have to. The thing to remember is if did work for a company but were never directly hired you need to fill one out. If not, you don’t.
Who Must Fill Out W-9 Federal Income Tax Forms?
Freelancers ‘Freelancers are hired by companies to do a variety of tasks for businesses, including logo design, writing, or website design. These jobs are generally short term and do not include normal perks of employment such as benefits or even an office. Many freelancers work offsite.
Consultants ‘ Business will hire people to help with financial, public relations or other work. Because they are not hired by the company directly, consultants are considered outside workers and will need to fill out a W-9.
Some freelancers, independent contractors or consultants enjoy frequent and long term work with a company. Some even work with the same company for years. Unless directly hired by the company, though, they are still considered outside workers. They must fill out W-9 federal income tax forms for company they work with.
Form W-9 for Information Reporting Only
Although the W-9 is a set of federal income tax forms, it is not actually sent into the IRS. Instead, they are turned into the business for which the outside freelancer, independent contractor or consultant performed work. The employer then uses this information to submit their own tax information to the IRS. In the meantime, outside workers will still use regular 1040 federal income tax forms as the basis for filing their own taxes.
If you are an independent contractor, turning W-9 federal income tax forms into to every company you are working for also ensures that they do not accidentally withhold taxes from your check.