IRS Form W-9 is used to request a taxpayer identification number, as well as the individual or business name and complete address. The information provided on this form is used by a business (the payor) to determine if an annual information return (Form 1099-NEC and 1099-MISC) is required to be filed with the IRS and issued to the recipient.
As a best practice, businesses should request a completed Form W-9 from all vendors or contractors at the onset of doing business and should be part of the onboarding process when setting up a new vendor. The completed W-9 should be obtained before remitting the first vendor payment. It may be more challenging to obtain an initial Form W-9 from vendors later, particularly if the vendor no longer does business with your company. This will save a lot of time and effort come tax season when any required Forms 1099 need to be prepared and filed with the IRS.