W-9 and TIN Verification Guide

Why TIN Verification Matters

IRS regulations require organizations to verify vendor Tax Identification Numbers before making payments. Failure to verify can result in:

Backup withholding requirements (24% of payments)

B-notices requiring re-solicitation of correct TINs

Penalties for incorrect information returns

The Verification Process

Step 1: Collect W-9

Request a completed W-9 form from each vendor. The form provides:

Legal business name

Business entity type

Tax Identification Number (EIN or SSN)

Address for tax reporting

Step 2: Validate TIN Format

Before submitting for IRS matching:

EIN format: XX-XXXXXXX

SSN format: XXX-XX-XXXX

Verify the name/TIN combination is consistent

Step 3: IRS TIN Matching

Use IRS TIN Matching service to verify:

The TIN is valid and assigned

The name matches IRS records

The combination is correct

Step 4: Document Results

Maintain records of:

Original W-9 form

Verification date and results

Any follow-up required

Step 5: Monitor for Changes

TIN information can change due to:

Business restructuring

Name changes

Address updates

Common Issues

Name Mismatches

The name on the W-9 must match IRS records exactly. "ABC Company" and "ABC Company, Inc." may not match.

Sole Proprietors

For sole proprietors, verify against the individual's SSN, not a business EIN.

Disregarded Entities

Single-member LLCs may need to use the owner's information rather than the LLC's.

Automation Benefits

Automated TIN verification provides:

Real-time IRS matching

Batch processing for multiple vendors

Audit trail of verification attempts

Automatic re-verification scheduling

VenLink integrates TIN verification into the vendor onboarding process, ensuring compliance before payments begin.