Do I have to pay taxes on Insurance payout to repair my roof if they are requesting that I fill out a W-9?

Answer 1

It sounds to me like this is a mis-use of the W-9 Form. An insurance claim settlement is not income, it is replacement of a loss. A W-9 Form would normally be given to an independent contractor by a company hiring that contractor to do work. When you receive an insurance payment as the result of a claim made for damages covered under an insurance policy, that settlement is not income. It does not make sense that you chould have to fill out a W9, which is really a request for an SSN or taxpayer indentification number, unless you are the contractor doing the work and will be paid for doing the job.

Who is "they", anyway?

Answer 2

The W-9 doesn't create a tax liability. If you had a casualty loss, report the insurance reimbursement on Form 4684.

There are times when an insurance reimbursement can result in taxable gain, which is computed on Form 4684. A gain or loss depends on the type of reimbursement and the value of the item damaged before the casualty.