You guys are all better informed than I am, so help me out here. Company A hires Company B (or an individual) to work in Company A's facility. If Company A reports on their taxes that Company B did work for them and Company B does not claim it on their taxes, then Company A is responsible for paying the tax. I have never heard this before but then I don't own a company.
IRS form W-9
- Thread starter Bobwhite
- Start date
It's a difference if the work is done by an individual or a company. If it's an individual that person is considered a temp and Company a is responsible for taking out taxes on them
If it's a company doing temporary work for another company, they are considered a subcontractor, or contractor I'm not sure which, but they get paid and are responsible for their own taxes.
At least I think that's how it works. But I do know that it's different if it's an individual doing the work or another company.
If it's a company doing temporary work for another company, they are considered a subcontractor, or contractor I'm not sure which, but they get paid and are responsible for their own taxes.
At least I think that's how it works. But I do know that it's different if it's an individual doing the work or another company.
I thought it might be an individual but his listing is a company name followed by "Inc." so I guess that is a company. We've hired people in the past and based on their cost quotes assumed that they were not reporting some or all of their income. My feeling is that that's between them and the IRS.
The W-9 is simply a transmittal of tax ID information to Company A. Entity B is still responsible for any/all taxes owed on any income received. In many cases a 1099 will also be issued to Entity B by Company A, which is why the IRS recommends that companies request W-9s from anyone - even vendors - that they'll pay more than $600 annually
HGMilstead
Active Member
Gilligan is 100% correct here.