A W-9 form is for vendors (service providers) to fill-out for you (the individual or business owner) to decide if it is required to issue a Form 1099 to the provider.
If you pay that vendor over $600 in the calendar year, and depending on his/her answers on the W-9 form, you may be required to issue a 1099.
For which type of entities must you file a 1099?
• Individual
• Single member LLC/Proprietorships
• Partnerships
• Trusts/Estates
For which type of entities is a 1099 not required?
• S-Corporations
• C-Corporations
The IRS has the ultimate goal of ensuring that you report all of your income. Corporations are always created through formalized ‘elections,’ therefore, the IRS believes they are more likely to report their income. Individuals, SMLLCs, Partnerships, Trusts, and Estates, are often more informal businesses that may make them less likely to report income received (unless required via a 1099).