why is my employer asking me to fill out the IRS W-9 form?

Answer 1

Your employer is trying to classify you as a contractor rather than an employee, if he controls when you do what, and you directly report to him working on an hourly basis or salary. You report to work at a certain time and can not leave until a certain time then you are an employee and he is responsible to withhold taxes from your wages. If you are free to show up when you want and work under your own supervision and use your own tools and material then you could be considered a contractor. If you have been receiving a W2 from him in the past with him holding taxes out and now he wants you to complete the W9. He is changing your status and that is not legal.
Read the attached rules for an employer to distingiuse between employee/contractor. if you feel that he is trying to switch you call the IRS @ 1-800-829-1040
If your are a contractor you are responsible for making Quarterly estimated tax payments through the year

http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

Answer 2

There are many reasons why an Employer COULD ask you to do a W-9. See http://www.irs.gov/pub/irs-pdf/iw9.pdf

However, the most common reason I see, is that an Employer intends to pay an Employee as a Contractor. Which means that THE EMPLOYEE, and not the Employer will be liable for all tax payments. In a state with sales tax, like Hawaii, a Contractor is also liable for a 4% surprise on top of the other taxes.

This is OK as long as the new Contractor realize that about 25% of the check must be paid to the IRS for Income, Social Security and Medicare Tax at Tax Filing time.

In my past life as an Engineering Consultant, I would add a premium of 25% to any client that hired me on a Contractor basis.

Employees typically only fill out W-4, where you designate your number of exemptions, so the EMPLOYER pays most of the tax, and withholds some money to cover the Employees income tax.

Answer 3

The W-9 form is used for independent contractors. This means that you will not be considered an employee and will not receive any benefits and you will have to pay your own taxes and social security. You had better check with the IRS for the guidelines to be paid on a w-9. Your position may not even qualify and your employer may be trying to get away with something.

Answer 4

Your employer might be considering you a sub-contractor and plan on sending you a 1099 in the future. I ask for a W-9 from my subcontractors. The only other thing I can think of is they want your SS# for records, although they could just ask you for that. I think the first theory is the likely one. Oh, and I think Jennifer B. above is getting a W-9 mixed up with a W-4. A W-4 is what you fill out to take exemptions and for withholding.

Answer 5

W-9 Form Hawaii

Answer 6

Because he's treating you as an independent contractor, not as an employee. He will not be withholding taxes, so you'll have to pay your own quarterly. And instead of paying 7.65% of your income toward social security and medicare, you'll be paying 15.3% since you'll be paying the employer share also.

There are specific requirements for a person to be considered an independent contractor and not an employee - the employer can't just decide to do it that way because he doesn't want to pay taxes. See http://www.irs.gov/faqs/faq12-2.html

Answer 7

Because the government told them they had to make you fill it out. And...it's helpful to you, it ensures the proper amount of tax is withheld through the year and you don't have to pay in April (or have too much taken out of your check!)