Every subcontractor you pay more than $600 in a tax year needs to submit a W9. It’s one of the simplest compliance documents in construction — yet W9 collection is one of the most common bottlenecks at year-end. Here’s how to fill one out correctly, what errors to avoid, and how to stop chasing them manually.
What Is a W9 and When Is It Required?
IRS Form W-9 (Request for Taxpayer Identification Number and Certification) is the document you use to collect a subcontractor’s legal name, business entity type, and Federal Employer Identification Number (EIN) or Social Security Number. You use this information at year-end to prepare 1099-NEC forms for any sub you paid $600 or more during the calendar year.
As a general contractor, you’re required to:
- Collect a W9 from every subcontractor or independent contractor before first payment (or at the very latest, before year-end)
- File a 1099-NEC with the IRS by January 31 for each sub paid $600+ during the prior year
- Apply 24% backup withholding to any payment made to a sub who refuses to provide a W9
Line-by-Line: How to Fill Out a W9
Line 1 — Name
Enter the legal name of the individual or business as it appears on their tax return. For a sole proprietor, this is their personal name. For an LLC or corporation, this is the legal entity name. This must match the name on your COI — a mismatch between W9 and COI is one of the most common compliance errors in construction.
Line 2 — Business name / DBA
If the business operates under a different trade name than the legal name on Line 1, enter it here. This field is optional but should be completed if the sub typically uses a DBA when invoicing.
Line 3 — Federal tax classification
Check one box that accurately describes the entity:
- Individual / Sole proprietor or single-member LLC — Self-employed individuals with no separate business entity
- C Corporation — Typically exempt from 1099 reporting (though exceptions apply)
- S Corporation — Typically exempt from 1099 reporting
- Partnership — Two or more owners; 1099 reporting required
- Trust / Estate — Uncommon for construction subs
- LLC — Must also indicate tax classification: C, S, or P (partnership). Single-member LLCs default to sole proprietor for tax purposes unless elected otherwise
Line 4 — Exemptions
Most subcontractors leave this blank. Corporations may enter an exempt payee code. If you’re unsure, leave it blank — incorrect exemption codes create more problems than they solve.
Lines 5–6 — Address
Enter the sub’s business address. This is where their copy of the 1099-NEC will be mailed at year-end.
Part I — Taxpayer Identification Number (TIN)
This is the most important field. Enter either:
- EIN (Employer Identification Number) — Used by corporations, partnerships, and LLCs with multiple members. Format: XX-XXXXXXX
- SSN (Social Security Number) — Used by sole proprietors and single-member LLCs not elected as corporation. Format: XXX-XX-XXXX
The TIN must match IRS records exactly. A mismatch triggers a B Notice from the IRS and requires backup withholding until corrected.
Part II — Certification (signature)
The sub signs and dates the form, certifying that the TIN provided is correct and they’re not subject to backup withholding (or if they are, they must indicate it). The form is not valid without a signature.
Common W9 Errors and How to Avoid Them
Name doesn’t match COI
The legal name on the W9 must match the named insured on the certificate of insurance. A mismatch means one of them is wrong — follow up before processing payment.
Wrong entity classification
LLCs must specify their tax election (C, S, or P). A blank classification field for an LLC creates TIN verification problems at year-end.
SSN used by an LLC
Multi-member LLCs should use an EIN, not the owner’s SSN. Sole proprietors and single-member LLCs can use either, but SSNs create privacy risk.
Missing signature
An unsigned W9 is not valid. Backup withholding applies until a signed form is received. Confirm signature before filing the form.
How to Collect W9s From Your Entire Sub Base
If you’re managing 50+ active subcontractors, chasing W9s manually at year-end isn’t a workflow — it’s a crisis. The fix is to collect W9s at vendor onboarding, track them alongside COIs, and automate renewal requests when they’re stale.
Billy collects and tracks W9s as part of the vendor compliance record alongside certificates of insurance, business licenses, MSAs, and other compliance documents. The sub’s W9 status is visible in the same dashboard as their COI compliance — so your AP team can see everything before approving a payment, not just the insurance status.
- Add W9 to your vendor onboarding form — Require it alongside the COI before the first invoice is approved.
- Use Billy’s free W9 generator — Share the link with subs. They generate a compliant W9 and submit it directly to your compliance record in Billy.
- Track W9 status in your compliance dashboard — See which vendors have submitted a current, signed W9 alongside their COI status.
- Set annual refresh reminders — W9s don’t expire but IRS guidance recommends updating them when a vendor’s information changes. Billy can trigger annual re-confirmation requests automatically.
Collect W9s and COIs in the Same Workflow
Billy tracks the full compliance document set — COIs, W9s, licenses, MSAs — in one place. Free for your subcontractors.
See How It Works →Frequently Asked Questions
Do corporations need to provide a W9?
Generally, you don’t need to file a 1099 for payments to C corporations or S corporations — but you still need their W9 on file for IRS verification purposes. The W9 is how you confirm the entity type. Always collect it regardless of entity classification.
How long should I keep a W9 on file?
The IRS recommends keeping W9s for at least 4 years after the tax return is filed for the year the payment was made. Many GCs keep them indefinitely in their vendor compliance record.
What if a subcontractor refuses to provide a W9?
You’re required to apply 24% backup withholding to all payments made to that vendor until they provide a valid W9. Document your requests and their refusal. This protects you if the IRS questions why withholding wasn’t applied.
Does a new W9 need to be collected every year?
Only if the sub’s information changes (name, address, TIN, entity type). Otherwise, a previously submitted W9 remains valid. That said, many GCs request updated W9s annually as part of their vendor compliance renewal process — particularly if any information is more than a few years old.
