If an individual contractor completes a 1099 requesting that a check be issued to a company's name rather than to the individual's name, shouldn't an EIN be provided, not a Social Security number?


First, examine the W-9. Is the contractor a sole proprietor? If so, you may issue the check in the company's name, but on the 1099, put the individual's name on the first line and company's name on the second line. We confirmed this with IRS information agent Hilliard (ID# 1002312).

Generally your inclination is sound. You may have seen the General Instructions for Forms 1099, 1098, 5498 and W-2G. Those instructions state the following concerning the payee information on a 1099:

"Recipient name. Show the full name and address in the section provided on the information return. If payments have been made to more than one recipient or the account is in more than one name, show on the first name line the name of the recipient whose TIN is first shown on the return. You may show the names of any other individual recipients in the area below the first line, if desired. Form W-2G filers, see the Instructions for Forms W-2G and 5754.

"For sole proprietors, you must show the individual's name on the first name line; on the second name line, you may enter the "doing business as (DBA)" name. You may not enter only the DBA name. For the TIN, enter either the individual's SSN or the EIN of the business (sole proprietorship). The IRS prefers that you enter the SSN.

"For a single-member limited liability company (LLC) (including a foreign LLC with a U.S. owner) that is disregarded as an entity separate from its owner under Regulations section 301.7701-3, enter the individual's name only on the first name line and the LLC's name on the second name line. For the TIN, enter the individual's SSN (or EIN, if applicable). If the LLC is a corporation, partnership, etc., enter the entity's EIN."

You can find this on the IRS web site at http://www.irs.gov/instructions/i1099gi/index.html.

Have more questions? Submit a request