The Internal Revenue Service (IRS) recently finalized the 2017 version of Form W-9 Request for Taxpayer Identification Number and Certification.
All changes reflected in the draft 2017 Form W-9 have been incorporated into the final version of the form; however, the IRS has not yet finalized the Instructions for the Requestor of Form W-9.
Below we have summarized the changes to the Form W-9 and the Instructions for the Requestor of Form W-9.
Purpose of the Form W-9.
Form W-9 is used by a payee to provide their taxpayer identification number to the person who is required to file an information return with the IRS for certain income paid to the payee.
Updates to the Face of the Form W-9
The only changes the IRS made to the face of the form are with regard to Line 3, which are summarized below.
- The 2017 version directs the individual or entity completing the Form W-9 to check the appropriate box for the federal tax classification of the person whose name is entered on line 1.
- In addition, the IRS clarified how a disregarded LLC should complete Line 3 under the following scenarios:
o If the LLC is classified as a single-member LLC that is disregarded from the owner it should not check the LLC box unless the owner of the LLC is another LLC that is not disregarded from the owner for U.S. federal tax purposes.
o Otherwise, a single member LLC that is disregarded from the owner should check the appropriate box for the tax classification of its owner.
Updates to the Form W-9 Specific Instructions
Changes to the Instructions for the Requestor of the Form W-9 *Not yet finalized*
The IRS added a notation to the individual taxpayer identification number (ITIN) section of the instructions warning that if an ITIN has not been included on an individual’s U.S. federal tax return at least once in the last three consecutive tax years, the ITIN will expire. Although an ITIN may expire, it can be still be used on the Form W-9, but must be renewed in order to prevent delays in processing an individual’s tax return.
For Your Reference
The final 2017 version of Form W-9 can be found here (PDF | 127KB).
The 2017 draft version of the Instructions for the Requestor of the Form W-9 can be found here (PDF | 224KB).
Any tax advice in this communication is not intended or written by KPMG to be used, and cannot be used, by a client or any other person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (ii) promoting, marketing, or recommending to another party any matters addressed herein.
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.