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Provision Business Services LLC

A Professional Bookkeeping Firm

Located in Albuquerque, Serving all of New Mexico


One topic that can be confusing for business owners is the federal requirement to report payments to vendors.

A W9 is a federal tax form you use to request a taxpayer’s federal tax identification number.  The easiest way to collect this form from your vendors is to do it before any business takes place.  Just tell new vendors that it’s part of the process of getting them set up as a vendor with your business.

One of the reasons I chose to address this topic is that it can be a heated one.  Some vendors get rankled at having to provide this information to you.  Asking for the W9 before any business transpires gives you the option of not using the vendor if they don’t want to give you a W9.  Once you have paid the vendor, you may have an obligation to collect a  W9 from them and report payments to them.

General summary of IRS reporting requirements:

1.  Payment was for a service
2.  You have paid the vendor $600 or more during the year
3.  You have paid with a paper check or cash

If all of these requirements are met, you have an obligation to collect a W9 from this vendor.  There are penalties to you for not reporting payments in these circumstances.

Vendors are required to provide you with a W9.  Keep in mind that legitimate vendors will have no problem providing you with a W9.

Thank you for submitting your document(s)! I will contact you, should I have any questions, comments, suggestions, or concerns.