Making the W-9 Form Process Easier with a DocuSign Template

For small businesses, hiring independent contractors can make more financial and logistical sense than bringing on full-time, permanent employees. It can be a practical choice for short-term or seasonal projects, or when outside expertise and skillsets are needed.

When you’re bringing on contractual employees, those earning more than $600 must complete and submit a W-9 form. In this article, we’ll explain what the tax form is, who’s required to complete it and how DocuSign can help make the process easier.

What is a W-9 Form?

The W-9 is an IRS form used by businesses to collect tax information from people they’ve hired as independent contractors. As a small business owner, you can request them to accurately prepare 1099 forms during tax season and disclose payments you’ve made each year.

Who is required to fill out a W-9?

Business owners should request W-9 forms from contractors, consultants and freelancers who’ve earned $600 or more during any given year. You’ll also need to collect a W-9 from sales professionals you’ve paid at least $5,000 within the past year.

Beyond self-employed contractors, W-9s might be required for anyone who has to report income outside the scope of a full-time job. Examples include real estate transactions, stock sales and canceled debt.

Full-time contractors typically complete a W-4 Form and aren’t required to fill out a W-9.

The W-9 is needed to generate a 1099 during tax season.

Information required on a W-9

Contractors will have to fill in basic information such as their name, business name (if applicable) and address on the W-9, as well as their social security number or taxpayer identification number. They’ll also need to indicate their federal tax classification, including C-corporation, S-corporation, LLC, or individual.

Certain entities have the option to submit claims for tax exemptions. Before submitting the form, it has to be signed and dated to certify its accuracy.

Make the W-9 process easier with a template

DocuSign’s W-9 template offers a quick and easy solution for filling out the tax document via PowerForms. The template uses special formula logic for social security and employee identification numbers to ensure the signer enters the correct information. Using the shareable template, employees can fill out the form faster, and HR professionals can upload the templates to their systems more efficiently.

Rather than task workers with complicated calculations, the pre-built DocuSign template does fast math for you to eliminate errors.

In addition to taking paper out of the equation, it also removes any confusion employees might have about what they need to fill out by tagging required fields. And it ensures highly sensitive personal information is kept safe and secure.

By digitizing the process, HR professionals can avoid the complexity of obtaining wet signatures and the tedious back-and-forth required when illegible handwriting makes vital data unreadable.

Ready to get started? Existing eSignature customers can access the W-9 template for free, and non-DocuSign customers can sign up for eSignature to access the form.