W9 Form Alabama 2022 – A W-9 is an Internal Revenue Service (IRS) tax form which is used to confirm the name, address, and taxpayer identification number (TIN) in order to prove reasons of employment or for other income-generating activities. The confirmation is available from an individual identified as a U.S. citizen or a person who is a resident or an alien. A W-9 form can also be known as A Request for Taxpayer Identification Number and certification form.
What does Form W-9 serve to do?
Most often, the W-9 data is used to create Form 1099. A 1099 form contains information regarding any income that could have been received from the TIN holder but could not be reported on the W-2 form. This includes, but is not restricted to, income given to an individual in connection with the terms of a contract; certain real estate transactions as well as dividends received from an investment; and other financial transactions.
Are you an independent contractor or employee?
Employers will withhold income taxes and also withhold Social Security, Medicare, and unemployment taxes on employees. If you’re an independent contractor, it isn’t. This means that you’ll be accountable for the employer’s share of Social Security and Medicare taxes however you will not be eligible for unemployment insurance in the event of being laid off.
Do I have to sign Form W-9?
Absolutely. Yes. The IRS has a mandatory obligation to companies to request a completed form W-9 from every person who has paid more than $600 during the year. There could be fines in the event of not complying.
If you feel that you know that the person asking for the form doesn’t have a legitimate reason for soliciting it, even you are hesitant, it’s probably a good idea. If you’re concerned, ask a tax professional to tell you what you need to do.
The Bottom Line
Forms for W-9 can be utilized by independent contractors (also known as freelancers). It is important to complete the correct form, but only if you have the right form to be submitted and the request has been granted. W9 Form Alabama 2022