Are there any benefits to filling out my W-9 for my new subcontractor position with and EIN or should I go with my SS#? I want to be able to pay as little as possible in taxes without doing anything illeagal. But I will have a lot of travel expenses and other expenses in this business. Thank you.
2006-10-23 22:09:28 · 5 answers · asked by Mustafa 5 in Business & Finance ➔ Taxes ➔ United States
The only thing that matters is what type of business structure you have. For instance, an LLC will fill out a W9 using an EIN and an individual will do so using the SSN. However, when it comes to paying tax both go on Schedule C (assuming the LLC has not elected to be taxed as a corporation) and the tax will be the same.
2006-10-24 00:17:07 · answer #1 · answered by skip 6 · 0⤊ 2⤋
If you were a corporation (probably an S Corp in your case), and you provided an EIN, you probably would not receive a 1099 at the end of the year. Payors are not required to issue 1099s to corporations (there are a few exceptions, i.e. lawyers). They "can" issue a 1099 to corporations, but generally are not required to.
This should, however, have no effect on how much you report on your tax return. And if you were a corporation you would have more tax forms to do.
2006-10-24 02:55:35 · answer #2 · answered by Dee 4 · 0⤊ 2⤋
The benefits are that you simply would not have to disclose your social security number and with identity theft out there, an EIN # is usually preferred. This EIN # is to identify your tax acct. without disclosing your social. It is easy to apply for and couldn't hurt, so go ahead and do it. Good Luck!
2006-10-30 03:12:09 · answer #3 · answered by lade40free 2 · 0⤊ 1⤋
Yeap as a business owner I can tell you that things go smoother. I have several sub-contractors and that proves your relationship with them early on so you can report their income. Also is better than having the ss# thrown around with people filling claims everywhere and identity thef is best to get a EIN. I did about 4 years ago when I opened my business. And it is really easy to do.
2006-10-26 01:33:10 · answer #4 · answered by . 3 · 0⤊ 2⤋
If you have employees you have to have an EIN thats the tax law. If you don't you only need your SSN. If your a sole proprietor you will file form 1040 schedule "C" and attach it to your 1040.
2006-10-24 08:27:05 · answer #5 · answered by Anonymous · 0⤊ 2⤋