W8 & W9

Which of the following policies for handling a missing Form W-9 or W-8 is considered the most compliant and carries the lowest risk of backup withholding liability for the client?

Apply a strict 'no form, no pay' rule until the form is received.

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Hold 10% of the payment and release it once the form is on file.

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Pay the vendor in full and collect the form later, if possible.

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Collect a signed declaration from the vendor stating they are a U.S. person instead of the form.

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Which federal tax classification, when checked in Box 3 of Form W-9, generally exempts payments for services from reporting on Form 1099-NEC or 1099-MISC?

Limited Liability Company (LLC) electing to be treated as a partnership

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Trust/Estate

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C Corporation or S Corporation

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Individual/sole proprietor

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What is the critical function of the name provided in Box 1 (‘Name’) on Form W-9?

It dictates the correct tax classification to be checked in Box 3.

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It is the legal name that must match the TIN on file with the IRS and must be used on Form 1099.

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It is an optional field that can be left blank if the 'Business Name' in Box 2 is completed.

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It is the 'remit-to' name for the payment check.

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If a client makes a payment to a U.S. vendor without a valid Form W-9, what is the mandatory backup withholding rate the client is immediately liable for on that payment?

24%

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10%

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15%

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30%

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A client is hiring a new marketing consultant who is an individual and a resident of France. Which form from the W-8 series is the appropriate one to request?

Form W-8BEN

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Form W-8BEN-E

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Form W-8ECI

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Form W-9

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