{"id":18085,"date":"2021-06-16T07:58:03","date_gmt":"2021-06-16T14:58:03","guid":{"rendered":"https:\/\/donorbox.org\/nonprofit-blog\/?p=18085"},"modified":"2023-08-28T11:31:58","modified_gmt":"2023-08-28T18:31:58","slug":"w-9-for-nonprofits","status":"publish","type":"post","link":"https:\/\/donorbox.org\/nonprofit-blog\/w-9-for-nonprofits","title":{"rendered":"How to Fill Out a W-9 for Nonprofits | Step-by-Step Guide"},"content":{"rendered":"

When you\u2019re running a nonprofit, it can feel daunting to think about filling out yet another <\/em>form. Internal Revenue Service forms are notorious for being confusing and overly complicated. Chances are you\u2019d rather focus your energy on something else\u2014like your organization\u2019s mission<\/a>.<\/p>\n

But fear not! IRS Form W-9 is actually a pretty simple form whether you\u2019re requesting it from someone else or you have to fill one out yourself.<\/p>\n

Read on for a step-by-step guide to make filling out a Form W-9 a breeze.<\/p>\n

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What is a Form W-9 for Nonprofits?<\/h2>\n

Your first step is to make sure you understand what the form is used for.<\/p>\n

IRS Form W-9<\/strong><\/a> is used when a business or entity needs to obtain the Tax Identification Number (TIN) from a contractor or business they have conducted business with. In other words, it is a request for taxpayer identification.<\/p>\n

Typically, the W-9 is only needed if the business has paid a contractor over $600 for the course of the year. Neither the business that requested the W-9 nor the contractor will file the Form W-9 with the IRS \u2013 it is purely to share the information required for other forms and filings.<\/p>\n

Along with a contractor\u2019s TIN, the W-9 Form also collects information on their backup withholding status. In most cases, the contractor is not subject to backup withholding and is therefore responsible for paying taxes on that income.<\/p>\n

The information collected on Form W-9 is then used by the business or nonprofit to file the Form 1099-MISC,<\/strong><\/a> which documents the total amount of money paid to the contractor.<\/p>\n

What does this mean for nonprofits? As you know, you may be tax-exempt but that doesn\u2019t mean you don\u2019t have to report anything to the IRS. Your biggest annual reporting happens with tax form Form 990<\/strong><\/a>. <\/b>However, there are two cases where you\u2019ll have to worry about filling out or requesting the W-9.<\/p>\n

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When Do You Need to Fill Out a W-9?<\/h2>\n

Here are two instances where you might need to deal with Form W-9:<\/p>\n

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  1. You get paid by someone else.<\/strong> Let\u2019s say you run a 501(c)(5) agricultural nonprofit<\/a>, and you provide some paid consulting work to a different farming cooperative. That cooperative will request a W-9 from your organization. Your organization has to fill out the form and return it in a timely manner so the farming cooperative can file the 1099-MISC form documenting that paid work.<\/li>\n
  2. You pay someone else.<\/strong> Your organization partners<\/a> with a local artist to design and paint a mural around the city promoting your recent campaign. After you\u2019ve paid the artist anything more than $600, you should request a W-9 from them. This will give you their TIN, address, and name so you can successfully document the income paid on a Form 1099-MISC. It will also clarify if they are subject to backup withholding. Be sure to check the Instructions for Requester of Form W-9<\/strong><\/a> to ensure you\u2019re within your rights to ask someone for their TIN.<\/li>\n<\/ol>\n
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    How to Fill Out the Form W-9 for Nonprofits<\/h2>\n

    Internal Revenue Service forms can be a headache. Luckily, the W-9 Form is one of the more straightforward forms.<\/p>\n

    Here’s how you can fill out the Form W-9 for Nonprofits:<\/strong><\/em><\/p>\n

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    Step 1 – Write your corporation name<\/h3>\n

    This refers to your official nonprofit corporation name as listed on your articles of incorporation. Be sure to write it exactly as it appears in your articles of incorporation and in your other IRS filings. You’ll share your more common name in the next step.<\/p>\n

    Step 2 – Enter your business name<\/h3>\n

    Sometimes referred to as your assumed name or fictitious name<\/a><\/strong>, this should be the name your organization operates under. Only enter this if it\u2019s different from your corporation name.<\/p>\n

    Pro tip: <\/strong>This is the name the public sees most often, which is usually only slightly different from the official name on your articles of incorporation (i.e., your official name includes \u201cInc.\u201d and your business name does not).<\/p>\n

    Step 3 – Know your entity type<\/h3>\n

    Your nonprofit is a corporation, so you should check the \u201cC Corporation\u201d box on your W-9. You could also check \u201cother\u201d and type \u201cnonprofit corporation\u201d in the provided line.<\/p>\n

    Step 4 – Your exempt payee code<\/h3>\n

    Nonprofit organizations exempt from tax under IRS code 501(a) are likewise exempt from backup withholding. Organizations that fall under this exemption must enter one as described in the W-9 instructions. Other federal tax classifications may not be exempt from backup withholding.<\/p>\n

    Step 5 – Give your street address<\/h3>\n

    Enter your organization’s mailing address in address lines 1 and 2.<\/p>\n

    Step 6 – Give your city, state, and zip code<\/h3>\n

    The next fields are city, state, and zip code. Be sure these are for your organization’s registered mailing address, which is usually the location of your organization or your organization’s registered agent.<\/p>\n

    Step 7 – List account numbers<\/h3>\n

    This space is for account numbers you wish to share with your W-9 requester. You don’t have to fill this out, but it is a secure way to share this information.<\/p>\n

    Step 8 – Taxpayer Identification Number (TIN)<\/h3>\n

    Mark your Employer Identification Number (EIN) issued by the IRS here.<\/p>\n

    Need to apply for an EIN? You first need to file Form SS-4<\/strong><\/a> as soon as possible. Once you\u2019ve applied (or if you plan on applying right away), you can write \u201cApplied For\u201d in the space for the TIN, sign, and date the form as you normally would, and give it to the requester. Usually, this means you have 60 days to provide your correct Taxpayer Identification Number to whomever requested a W-9 from you. But you should double-check with your own tax advisors to be sure your payment type is eligible for this extension.<\/p>\n

    Step 9 – Certify your information<\/h3>\n

    This section is also pretty straightforward, though you should check the instructions included in the form to be sure your unique situation doesn\u2019t require any further acknowledgment. This section simply asks you to certify that the information you provided is true to the best of your knowledge. Sign on the line and mark the day\u2019s date.<\/p>\n

    w-9 Forms can also be signed and submitted electronically, so no need to worry about printing and signing.<\/p>\n

    And that\u2019s it! Once it\u2019s filled out, you can move on to the next step.<\/p>\n

    \"\"<\/a><\/p>\n

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    How to Submit a Form W-9<\/h2>\n

    Submission depends on which side of the W-9 Form you\u2019re on: requester or requestee. Here\u2019s what to do in either case.<\/p>\n

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    1. Someone asked your organization to complete a W-9. Great! All you have to do is fill the form out and get it back to them ASAP. It\u2019s a good business practice to take no more than around a week to get the form back to them once you receive the request. Since it\u2019s such a simple form, you shouldn\u2019t run into any major snags unless you have to apply for an EIN<\/strong><\/a>.<\/strong><\/li>\n
    2. Your organization asked someone else to fill out a W-9. When you request the form, give clear instructions for how you\u2019d like to receive the signed form. You can ask them to fax it to you, send a copy via email, or complete the form via an online document service.<\/li>\n<\/ol>\n

      Once you have the signed form, you can look into completing Form 1099-MISC<\/strong><\/a> and returning it to the person or organization in question. Usually, if your organization has paid at least $600<\/a><\/strong> throughout one year to a non-employee for services, parts, and materials needed for your organization\u2019s business, you must furnish a Form 1099-MISC to that person by January 31 of the following year.<\/p>\n

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      Conclusion<\/h2>\n

      Although filling out IRS forms can sometimes feel like a nightmare, the Form W-9 is luckily pretty simple for nonprofit organizations. This leaves you more time to focus on the work that really matters and less time squinting at the small type on a form.<\/p>\n

      The w-9 Form requests information like name, Taxpayer Identification Number (TIN), address, and whether someone is subject to backup withholding. It’s an important form to help with tax time, especially if your nonprofit has used contractors or done any contracting work.<\/p>\n

      The most important step? Know that you got this. With some careful work, you can fill out the Form W-9 easily and correctly. The business or individual you\u2019re working with will thank you for a prompt response!<\/p>\n

      Looking for more ways for running your nonprofit easier? Check out the other resources on our Nonprofit Blog<\/a>. We also have dedicated articles for starting a nonprofit in different states in the US, including Texas<\/a>, Minnesota<\/a>, Oregon<\/a>, Arizona<\/a>, Illinois<\/a>, and more. Plus, our Library is packed with free downloads to make every step of the nonprofit process easier.<\/p>\n

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      Frequently Asked Questions [FAQs]<\/h2>\n
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      1. What is a W-9 Form?<\/h3>\n

      The Internal Revenue Service provides the W-9 Form for businesses who need a secure and clear way to collect information from their contractors. They then use that information to fill out a Form 1099-MISC for any contractors and freelancers that have been paid at least $600 for their work over the course of the tax year.<\/p>\n

      This form helps contractors file their taxes correctly. So the W-9 Form is the key to making tax season run smoothly for all involved!<\/p>\n

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      2. What information do you need for a W-9 Form?<\/h3>\n

      In order to fill out a W-9, you’ll need the following information:<\/p>\n