Do Corporations Need a W-9?

One of the Internal Revenue Service’s many forms, the W-9 provides employers the opportunity to collect taxpayer numbers from employees. Under U.S. tax law, the government taxes some corporations as individuals, rather than business entities. The question of whether corporations need a W-9 depends upon the specifics of the situation and the type of corporation in question. The IRS regularly revises instructions for filing out the W-9.

Form W-9 provides an employer with the Tax Identification Number of an employee. Anyone approved for work in the United States, including citizens and resident aliens, possesses this number. Filling out the form constitutes a relatively straightforward endeavor, as it requires little more than the name, address, Tax Identification Number, tax classification and signature of the individual in quesetion. Companies do not file these forms with the government, but rather keep them in employee files as a reference sheet.

When a corporation subcontracts work, it often asks the subcontracted employee to fill out and return a W-9 form for reference. Corporations use the information supplied by a W-9 for tax purposes. A subcontracted employee’s Tax Identification Number allows corporations — and any other employer, for that matter — to properly pay and tax employees, and report all payments made to subcontracted employees to the IRS. Banks may also ask customers to file a W-9 as proof of identity and taxpayer status.

In some instances, corporations must file W-9 forms when contracted for work by other corporations or employers. When an individual works under a limited liability company such as an S Corporation, C Corporation, partnership or sole proprietorship, that individual must file a W-9 as a corporation with the corporation’s tax number. In such instances the W-9 must contain the Tax Identification Number of the corporation and not the individual. Any person working as a corporation wishing to use a personal Tax Identification Number on a W-9 for a specific job must file the form as the individual and not a corporation.

For a United States citizen, a Tax Identification Number constitutes your Social Security Number. Permanent residents without Social Security numbers can apply for a Tax Identification Number with the IRS. New residents of the United States must obtain a Social Security number before beginning work. If a business subcontracts work with a non-U.S. citizen or resident, that individual can file a W-8 form rather than a W-9 form.