Sometimes we have trouble with new vendors refusing to complete to most recent version of the W-9 (2015). What documentation can I provide these vendors so that they are aware the new forms are required?

Follow

We spoke with IRS Information Reporting Specialist Ms. Alampi at the IRS (ID# 1000705414), who refers you to the Instructions for the Requester of Form W-9, and  IRS Publication 1281, Backup Withholding for Missing and Incorrect Name/TINs. The instructions address when to use form W-9 and the use of a substitute W-9. Pub 1281 addresses backup withholding in connection with B-notices. We also recommend you see IRS Publication 1586 Reasonable Cause Regulations & Requirements – Missing and Incorrect Name/TINs, which cites applicable regulations. (Note that the penalty amounts in the current publication are increasing for 2015 reporting.)

Technically you are not required to obtain a W-9 unless/until you receive a B-notice; you are required to obtain certain information, and the most current W-9 is the best way for you and your vendors to do that, since it is designed to provide you the information you are required to have to comply with payment reporting requirements.

Ms. Alampi recommends that when you solicit a W-9, that you send the vendor the current version and ask them to complete it. Explain why you need it. The reason you want the current version is that it is refined to be up-to-date with the information requirements you have—not only name and TIN, but tax classification and, if they claim exemption, an exemption code—which was not on the old form, but is on the new form. So you want to explain you are required to get certain information, and the current W-9 is the best way to do that.  

So provide them the new form with a nice explanation of why you need it (the information on it). You don’t want to have to backup-withhold on their payment.

Have more questions? Submit a request

Comments