W-9 for Limited Liability Companies - An Overview
Updated on November 17, 2023 - 10:30 AM by Admin, TaxBandits
Form W-9 is an integral part of tax compliance for any business type, and the LLC is no exception.
If you are a Limited Liability Company that has hired and paid independent contractors, you can use TaxBandits’ Form W-9 Manager to Request W-9 Forms online, collect them, and manage them in one place.
On the other hand, if any other business requests your LLC to provide a W-9, you can use TaxBandits’
Fillable W-9 solution to complete and share your W-9 Form in minutes.
Keep reading this article to gain a better understanding of Form W-9 and explore secure options for your LLC to complete, submit, and/or request this form.
In this section we will cover the following topics:
1. Purpose of Form W-9
Form W-9 is an IRS document that allows you to provide the Taxpayer Identification Number (TIN) of your LLC to other businesses or individuals (payers). These payers will use the information to file 1099 Forms, reporting the payments they made to you.
The following information is required on your Form W-9:
- Name and Address
- Federal tax classification
- Taxpayer Identification Number (TIN)
- Backup withholding requirements
- Exemption code for FATCA reporting (if applicable)
2. Federal Tax Classification of LLCs
In order to complete the W-9 for your LLC, you must have a clear understanding of your federal tax classification.
Typically, LLCs are classified as:
Single Member LLCs
If you are the sole owner of your LLC, your business will be classified as a Single-Member LLC, also known as a Disregarded Entity for federal tax purposes.
If your LLC is comprised of two or more owners or shareholders, you can register your LLC to be treated as any of the following:
- Partnership: This business structure involves two or more members as owners or shareholders. Each partner pays individual taxes for their share of the profit.
- C Corporations: These are corporations with more than 100 shareholders, where the shareholders are liable for corporate income taxes as well as individual taxes on dividends they receive. This is known as double taxation.
- S-Corporation: These are corporations with fewer than 100 shareholders that have chosen to pass corporate income and losses through to their shareholders for tax purposes. S-Corporations don’t experience double taxation.
3. How to Fill Out a W-9 for an LLC
Here are the step-by-step instructions to fill out a W-9 Form for your LLC:
Name (Lines 1 and 2)
Based on your LLC’s federal tax classification, you’ll need to enter the applicable names in each of the first two fields.
- If your LLC is a Disregarded entity, you must enter your name on Line 1 and then enter the name of your LLC on Line 2.
- For example, if your name is John Doe, and you operate under the DBA (Doing Business As) name ‘John Doe LLC’, you must enter the former on Line 1 and the latter on Line 2.
- If your LLC is treated as a Partnership or Corporation, you can enter your business name on Line 1 and leave Line 2 blank (or) enter any other trade or DBA name if you have one.
Federal Tax Classification (Line 3)
In this line, you can indicate how your LLC is classified for federal tax purposes.
- If your LLC is a Disregarded entity, you must check the box ‘Individual/sole proprietor or single-member LLC’.
- If your LLC is treated as a Partnership or Corporation, you must check the box ‘Limited liability company’ and enter the corresponding code to indicate the classification.
- C = C Corporation, S = S Corporation, P = Partnership
Exemption Codes (Line 4)
Enter the exemption code, if applicable.
These exemption codes indicate that your LLC is exempt from Backup withholding or FATCA Reporting, if applicable.
Address (Lines 5 and 6)
Enter the complete address of your LLC, including Suite no./Apt no., street name, city, state, and ZIP code.
Account Number (Line 7)
If your LLC has any account numbers, list them here.
Part I - Taxpayer Identification Number (TIN)
Here, you’ll have two boxes for Social Security Number (SSN) and Employer Identification Number (EIN). You only need to fill out one of them.
- If your LLC is a disregarded entity, you can enter your SSN.
- If your LLC is treated as a Partnership or Corporation, you can enter your EIN.
Part II - Certification
Here, you can certify that your LLC is not subjected to backup withholding under the mentioned criteria.
4. Fill Out a W-9 For Your LLC in Minutes with TaxBandits!
TaxBandits offers a fillable W-9 solution that allows your LLC to complete and share your Form W-9 electronically with your payers or requesters in no time.
Just follow the below steps to fill out the W-9
for your LLC:
Step 1: Enter the required data on your Form W-9.
Step 2: Preview the data and e-sign the Form
Step 3: Once e-signed, download or share it electronically with your payers.