Page 1 of 1

Referral requiring a W9

Posted: Fri Sep 27, 2013 7:52 am
by gsleaf
Does anyone know if it's common to have to fill out a W9 to get a solar referral bonus? I referred a friend and the company wants a W9 form (which I wouldn't care about except they want my SSN). Supposedly any referral bonus over $400 requires a W9.

Re: Referral requiring a W9

Posted: Fri Sep 27, 2013 8:40 am
by vrwl
gsleaf wrote:Does anyone know if it's common to have to fill out a W9 to get a solar referral bonus? I referred a friend and the company wants a W9 form (which I wouldn't care about except they want my SSN). Supposedly any referral bonus over $400 requires a W9.


As a business owner, I can tell you that we have to provide 1099's at year end to anyone we pay more than $600 to for various services. I looked up some of the information about the 2013 reporting requirements and that $600 threshold does not appear to have changed. Here's the SOME of the IRS text (the number of "services" that must have 1099's issued to the "service provider" is actually huge):

"File Form 1099-MISC, Miscellaneous Income, for each
person to whom you have paid during the year:

At least $10 in royalties (see the instructions for box 2) or
broker payments in lieu of dividends or tax-exempt interest
(see the instructions for box 8);

At least $600 in rents, services (including parts and
materials), prizes and awards, other income payments,
medical and health care payments, crop insurance proceeds,
cash payments for fish (or other aquatic life) you purchase
from anyone engaged in the trade or business of catching
fish, or, generally, the cash paid from a notional principal
contract to an individual, partnership, or estate;"

Since you would probably fall under the services, prizes and awards, or royalties categories, they have to file the payment with the IRS if the payment equals or exceeds the requirement threshold, which means they need the W9 form from you. However, you would need to find out from a tax professional whether a referral payment is considered a royalty or a service, because the dollar threshold is significantly different between the two for reporting to the IRS.

Re: Referral requiring a W9

Posted: Fri Sep 27, 2013 8:46 am
by smkettner
Yes it is common with a large company.

Re: Referral requiring a W9

Posted: Fri Sep 27, 2013 9:05 am
by gsleaf
vrwl, thanks. That makes sense, I'm very reluctant to give my SSN out so I wanted to make sure before I sent in a W9.