Common Errors to Avoid When Filing Out Form W-9

Form W-9, officially known as the “Request for Taxpayer Identification Number and Certification,” is an essential legal document the U.S. government uses to track taxpayer information. As an independent contractor or freelancer, you will provide your payer with your Taxpayer Identification Number (TIN) using this form. Payers will use this information to report payments via 1099 forms.

Filling out a W-9 might seem straightforward, but errors can lead to complications like delays, penalties, or even backup withholding. Here are five common mistakes you should avoid.?

1. Entering Your Name Incorrectly

The first field requires your name, and this is where mistakes often happen. If you are a sole proprietor, enter your name as it appears on your income tax return. If you have a business or DBA (Doing Business As) name, it should go on the “Business name/disregarded entity name” line. If you don’t have one, simply leave Line 2 blank.

Typos are one of the most frequent errors in this section. Double-check your name to ensure it matches official identification documents. Mistakes here can cause issues when the IRS processes your 1099 form.

2. Providing the Wrong TIN

Your TIN is one of the most critical pieces of information on the W-9. For independent contractors, this is typically your Social Security Number (SSN), while businesses use an Employer Identification Number (EIN).

Providing the wrong TIN or leaving this field blank can result in significant issues, such as penalties. Double-check your TIN to make sure it matches IRS records. Remember, failing to provide a valid TIN to your payer can result in a penalty of $50 for each form with incorrect or missing information.

3. Choosing an Incorrect Federal Tax Classification

The W-9 form comprises several checkboxes for different federal tax classifications (e.g., individual/sole proprietor, LLC, corporation, partnership). Selecting the wrong one is a common mistake that can have tax implications.

If you're unsure which tax classification applies to you, consult a tax professional. Choosing the wrong classification can lead to confusion and potential tax liabilities later. A quick consultation can save you from unnecessary headaches.

4. Overlooking Backup Withholding

Backup withholding occurs when the IRS requires payers to withhold 24% of payments if you fail to provide accurate information on your W-9.?

To avoid backup withholding, ensure your TIN and other details are correct. If you are subject to this withholding, you must strike out Line 2 in the certification section of the form.

5. Forgetting to Sign and Date the Form

This might sound simple, but forgetting to sign and date your W-9 form is one of the most common mistakes people make. Without a signature, the form is considered incomplete, and the payer may not accept it. This could lead to delays or the payer's enforcement of backup withholding.

Before submitting your W-9, ensure you’ve signed and dated it in the certification section. This simple step can prevent unnecessary complications.

Send Your Completed W-9 Securely

Once you’ve filled out your W-9, submit it to the payer who requested it. However, be cautious when sharing sensitive information like your TIN. Avoid sending your completed form through unsecured methods like email.

Let TaxBandits Simplify Your W-9 Process

Avoid these common mistakes and securely complete your Form W-9 with TaxBandits. TaxBandits offers a fillable W-9 solution that lets you complete your form and securely send it to the requesting business.

If your business works with independent contractors, you can use TaxBandits' W-9 Manager to collect and store all your W-9 forms in one place, streamlining your tax compliance.

Avoid simple errors that can complicate your tax filings—let TaxBandits handle the details so you can focus on running your business.