Filling out a W-9 form without thinking can be expensive
Filling out a W-9 form without thinking can be expensive
9040 Town Center
Lakewood Ranch, FL 34202
941 538 5630
616 970 3000
dougzandstra@gmail.com
Joe business person had done everything correctly. He went and saw a CPA and an Attorney after his business became successful, and he even paid his CPA to re-arranged his LLC so that it would get favorable tax treatment by being taxed as an S Corporation.
So how did Joe end up getting a notice like this?
Well here is what happened.
After Joe’s business was all set up, Joe started doing some contract work for a company. Joe was busy working one day and got a call from the contractor, “Hey we can’t pay you until you give us your W-9, all they need is your name and social security number, I have your name, so give me your social security number and you can get paid”, No problem says Joe, here it is”
Sounds innocent – right ? what just happened ?
Joe just created a paperwork glitch where the IRS was now getting information that was different than what Joe had set up.
When you start a business and obtain a new legal status and a new federal identification number you as a person cease to exist for business purposes. Everything that you complete and fill out relating to your business should include your legal business name and the federal identification number (FEIN) that was assigned when you registered your business.
Also if you changed your entity structure during the year, you want to notify everyone that you are working by providing them with a new W-9 form, so that the information that is reported to the IRS matches how you report it on your tax returns.
We are located at:
Filling out a W-9 form without thinking can be expensive
Doug Zandstra CPA CFE EA 9040 Town Center Lakewood Ranch, FL 34202 941 538 5630 616 970 3000 dougzandstra@gmail.com
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