1099 – W9 Forms

Answer to How does a 1099 differ from a W-9 when filing taxes?

Answer by Wray Rives CPA CGMA:

W9 Form

A W9 Form Form W-9, Request for Taxpayer Identification Number (TIN) and Certification is a request for your taxpayer ID number. Typically that is your social security number. Independent contractors normally complete a W9 form to give to their customers who will use the information to file Form 1099 in January of each year. W9 form may also be used to request a taxpayer ID for other types of income such as interest, dividends or rents. W9 forms are kept on file by the business that requests the form, unless the IRS has a problem matching up the information from the W9 that is used on a 1099 Form.

1099 Form

A 1099 Form 1099-MISC, Miscellaneous Income is an information return that is filed in January of each year. Is is used to report income paid to an independent contractor for providing services during the year. The form may also be used to report other types of income paid by a business during the year such as

  • rents;
  • prizes and awards;
  • other income payments;
  • medical and health care payments;
  • crop insurance proceeds;
  • cash payments for fish (or other aquatic life) you purchase from anyone engaged in the trade or business of catching fish;
  • generally, the cash paid from a notional principal contract to an individual, partnership, or estate;
  • payments to an attorney; or
  • any fishing boat proceeds,, but typically you are looking at self employment revenue being reported. One copy goes to the independent contractor and one copy goes to the IRS. In some cases a copy may also go to the state where the contractor performed work.

The most common item however is non-employee compensation or payments made to an independent contractor by a business. A 1099 is required when the sum of payments totals more than $600 during the calendar year.

One copy of the 1099 goes to the independent contractor, one copy to the IRS and depending on which state the contractor worked in, a copy may go to the state.

How does a 1099 differ from a W-9 when filing taxes?