a company is accepting responsibility for some damage to my friends car and they are tryin to make him fill out a W-9 form before paying him. it requires his ss# and all that crap. does this make sense? they said its required before the company can pay him. looks like some kind of form used for employment.. not to pay him for damages they caused. wtf lol

 

I wouldn't be surprised if its some new patriot act requirement, homeland security is getting all up into everyone's financial stuff, and official forms are needed to make sure the insurance companies aren't funding ter'ists

 

Sounds fishy

what company is it?

 

Doesn't really sound fishy at all, companies need to keep track of where their outgoing payments go, a W-9 is a request for taxpayer ID that is commonly used to document the identification of any accounts payable payment.

Unless the company itself seems fishy- that's a whole 'nother ballgame.

 

Why cant they just write it like its a purchase order or something?

 

is he goin through his own insurance?

not a tax pro, but i did stay at a holiday inn express

 

well, he is responsible for the deductible that is not covered by insurance. he complained to the company for being partly responsible for the damage and the company decided to cover the deductible. they want him to fill out a W-9 form before they pay him out.

 

A W9 is used to collect all tax information for tax pruposes. Meaning, for 1099's at the end of the year. It is not required for reimburseable expenses such as this. If a company is asking for a W9, it says to me that they are planing on issuing a 1099 saying that they paid out untaxed money to your friend and reporting such to the IRS. Which is completely wrong. I've been working in accounting for 5 years now and manage the AP department for the company I work for as well and I never have ask anyone for this type of information when we are reimbursing for these types of expenses.

Bill

 

BillJC- you are thinking of the W-4, the W-9 is only a taxpayer ID number form, no other tax information is on it at all.

 

The W4 is for your personal income tax declarations. The W9 is used to collect tax ID numbers and SSN's for 1099 purposes. There is no other use for this form. There is no need for a company to collect such information with this form unless it's used to issue a 1099. If you have ever won any amount of money over $1-2,000 in tahoe or vegas, they will have you fill out a W9 in order to collect your SSN to report your earnings to the IRS. If they are asking for a W9 then they will issue a 1099 presenting what they paid out as taxable income to the individual. And when he files his 2006 tax return, the IRS will see the payment as undclared income.

Bill

 

OK I'll admit you probably do know more about it than I do, although I still don't agree with your position that it is used only for 1099 purposes, but whatever...

The OP was essentially asking for advise on whether or not his friend should be compelled to disclose his SSN, a good question.

About the best discussion of the subject I could find is this;

(from privacyclearinghouse.com)


Do I have to provide my Social Security number to private businesses?

Usually you are not legally compelled to provide your Social Security number to private businesses -- including private health care providers and insurers -- unless you are involved in a transaction in which the Internal Revenue Service requires notification. (MediCal and Medicare are government health plans and can require a Social Security number.)

There is no law, however, that prevents businesses from requesting your SSN, and there are few restrictions on what businesses can do with it. But even though you are not required to disclose your SSN, the business does not have to provide you with service if you refuse to release it.

If a business insists on knowing your Social Security number when you cannot see a reason for it, speak to an administrator who may be authorized to make an exception or who may know that company policy does not require it. If the company will not allow you to use an alternate number, you may want to take your business elsewhere.

Credit card applications usually request Social Security numbers. Your number is used primarily to verify your identity in situations where you have the same or a similar name to others. Although most credit grantors will insist on having your SSN, you may be able to find a credit grantor who will provide you credit without knowing your SSN, especially if you are persistent and can provide other forms of identification. But such instances are rare.

In California, a new law restricts how certain businesses can display their customers' Social Security numbers. It does not restrict the collection of SSNs, however, and it does not affect government agencies. California Civil Code 1798.85 is being phased in from 2003 to 2005. Insurance companies will not be able to print the SSN on identification cards to be carried in the wallet. Customers of banks and investment companies cannot be required to transmit the SSN over the Internet when conducting business online, unless the number is encrypted. SSNs cannot be printed on documents sent through the mail, with some exceptions. The California Office of Privacy Protection provides a guide for businesses on "recommended practices" for using SSNs. It includes a description of the new law, http://www.privacy.ca.gov/recommenda...mendations.pdf. The full text of the law is found on the state's official legislative web site, www.leginfo.ca.gov.