Contractors Run After W-9 Requested

[James H.]

We used to do all of the unskilled labor, plus a few skilled things, ourselves.  But, we have come to a point where we have to start hiring things out.

A few weeks ago, we had a painter paint a property.  He did a wonderful job.  He reluctantly gave us a social security number in exchange for a check; but I understand we should have asked him to complete a W-9.  He quoted another job but then said, "I am booked until further notice."  I texted him about another job about a month later and he seemed very excited to do it until he realized who he was talking to.  Silence after that.

This morning, we had a cleaning person and her son come by.  They did a great job.  They wanted to be paid in cash and we obliged.  $100 for a nice deep clean.  We told her that we were extremely happy about the job and wanted to hire her in the future for more cleaning jobs.However, she refused to fill out a W-9 and said that she would not give us a tax number under any circumstances.  We explained that we wouldn't be able to hire her again without it.  The cleaner dramatically threw up her hands in a huff, ran down the stairs, and screamed hysterically, "I can't believe you didn't like my job!  I worked so hard!"   

How does everyone else deal with this?  By the way, none of these people were illegal immigrants...

[Daniel Hyman]

Not sure if this is helpful, but I figured I would post a few tidbits about 1099's:

If your business made payments to an independent contractor of $600 or more during the course of the year, you are required to issue a form 1099. Much like a W-2 is issued for an employee, a 1099 is sent to an independent contractor. Contractors can be individuals or companies. You do not need to send a 1099 to most corporations. The information needed to fill out a 1099 can be taken from from the contractor’s W-9. Total payment should be entered in box 7 of the 1099. The deadline for sending 1099’s is Jan 31 – the same date as W-2’s for employees. Penalties for missing the deadline range from $30 $100 per form. Form 1096, which summarizes the totals for all 1099's, must be provided to the IRS no later than March 31. Be sure to keep a record of all your filings. The best way to ensure correct filing is to have accurate bookkeeping and records. And always consult your accountant for further guidelines and instructions.