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In almost every country, tax issues pose a major problem. Evasion of tax can easily lead to jail time or cause one to incur unwarranted interest. On top of that, one is bound to incur extra expenses like legal fees when the case is taken to court. As such, it’s important to ensure that you file your taxes right on time and have everything documented. The W9 IRS form is one of the forms that anyone working fulltime or freelance or earns from any business needs to know about.
The W9 IRS form, is one that you’ll need to enable an entity to keep a record of the income they pay to you. If you have been a freelancer for any company, then you must have at some point had to deal with the W9 IRS form. The W9 form is used by companies or individuals who will pay your income during the year. The W9 IRS form is also known as the Request for Taxpayer Identification Number and Certification. The form is used by individuals to provide their identification number to their taxpayer. Your W9 IRS form is mainly used for payroll purposes, but never gets sent to the IRS. Your identification number is the information that’s used to prepare paychecks during the year you are working. Additionally, the W2 form is what’s used during the end of the year. In the case of one being an independent businessperson or contractor, any client you work with will request that you issue them with the W9 IRS form to allow them record all the payments that they’ll issue you with.
With processes being made easy to allow for individuals to be able to get the W9 IRS forms, one can easily find and download the W9 form from the IRS website. The form will require you to fill in your name as is on your income tax return. In case one has a registered business under a different name, one can fill that just below the name section. The next section you will be required to tick a box on the type of federal tax classification. There are seven boxes with different tax classification brackets. Anyone filling the form will be required to tick one box out of the seven. In the case of an employed or self-employed individual, the tax classification that is appropriate is the ‘Individual/Sole Proprietorship’ bracket. In case one has a company or an estate, they can proceed to check the boxes that suits them. Additionally, you will need to fill in your address details and fill in your account numbers although it’s optional.
Once you have filled in your address details, the next section will require you to fill in your taxpayer identification number. For residents of the States, the tax identification number, commonly referred to as TIN, is your Social Security Number (SSN). If you are a non-residents filling in the W9 IRS form and don’t have the Social Security Number, you will need to fill in the tax identification number that was assigned to you. In the case you have established your own business and have an employer identification number, you will need to fill that under the Employer Identification Number (EIN). Any individual or company requesting your W9 IRS forms is usually required by the IRS to withhold a certain percentage of your pay to cater for federal income taxes. This is commonly known as the backup withholding. In the case that you are eligible for backup withholding, the IRS will notify you. It’s then your duty to notify the company that you will be providing your W9 form to that they ought to withhold taxes from what they’ll be paying you.