Understanding W-9 forms: US contractors

Objective: This article provides an overview of the W-9 form, which applies to U.S. tax residents, and explains how to complete it on your Cadana account.

 

 Outline

1. What is the W-9 form?

2. Who Needs to Complete the W-9 Form?

3. What Information is Required on the W-9 Form?

4. Sample of W-9 Form

5. Importance of the W-9 Form

6. How to Complete the W-9 Form on Cadana

7. Accessing the signed W-9 Form on Cadana

8. Read more

What is the W-9 form?

The W-9 Form, also known as Request for Taxpayer Identification Number and Certification, is a widely used IRS tax form that serves as a crucial document for individuals or entities that anticipate receiving certain types of income in the United States. 
This form gathers essential information from payees, including their name, address, and taxpayer identification number (TIN), which is typically either a Social Security number (SSN) or an Employer Identification Number (EIN). This information is then utilized by the payer to accurately prepare information returns.

Who Needs to Complete the W-9 Form?

The W-9 Form is typically required for individuals or entities (tax residents) that receive payments from a business during the calendar year. This includes independent contractors, freelancers, vendors, and other non-employee recipients of income. However, the form may also be requested in other situations, such as when a person receives dividends, interest, or rental income from a non-related party.

What Information is Required on the W-9 Form ?

In filling your W-9 form, you will need information on: 

1. Full legal name and complete address are required.

2. Taxpayer Identification Number (TIN),  either an SSN or EIN.

3. Certifications that the provided TIN is correct and that they are not subject to backup withholding.

4. Optional FATCA Certifications: If applicable, the recipient may choose to provide FATCA certifications to indicate their exemption from FATCA reporting.
   
   

What does a W-9 Form look like?

Importance of the W-9 Form

The W-9 plays a crucial role in accurately reporting income and ensuring compliance with tax regulations to the United States authorities. By providing accurate information on W-9, recipients can help payers meet their reporting obligations and avoid potential penalties. Additionally, completing Form W-9 helps individuals and entities maintain proper documentation for their own tax records.

If a recipient fails to provide a completed Form W-9 to the payer, the payer may be required to withhold 24% of the gross payment to the recipient as backup withholding (recently updated). This withholding is intended to ensure that the recipient complies with their tax obligations.

How to Complete W-9 Form on Cadana

• Once you have not yet signed the  W-9 form, you will see a prompt on your home page.
• Click on Sign Form to begin
• Review and edit the prefilled information (from your onboarding data) on your tax information and address details.
• Review the information on the W-9 tax form. (If you are a business entity, please switch account type to business contractor first)

• Make final edits on the form itself where necessary, review and sign.

Accessing the signed W-9 Form on Cadana

• On your home page, locate Tax forms at the bottom of left menu bar.
• Click on Tax forms so display the details of forms signed.

• Click on the download command by the specific form to access it.

 

Please read more from the Internal Revenue Service (IRS), US here

Note: If you need further assistance or need to correct any error on your signed W-9 form, please reach out to us via [e-mail].