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Version: 1.7.3

Overview

If you pay recipients (payees) more than the IRS-specified threshold or withhold backup withholding, you're required to file either Form 1099 or Form 1042-S with the IRS. To do this, you must first collect key information from each payee—including their Taxpayer Identification Number (TIN), legal name, address, federal tax classification, backup withholding status, and any applicable FATCA exemption codes.

To collect this information, payers should use one of the following IRS forms based on the payee’s citizenship status:

  • Form W-9 - For U.S. individuals or entities
  • Form W-8BEN - For non-U.S. individuals
  • Form W-8BEN-E - For non-U.S. entities
  • Form W-8ECI - For non-U.S. individuals or entities claiming income is effectively connected with a U.S. trade or business
  • Form W-8IMY – For intermediaries, flow-through entities, or certain U.S. branches
  • Form W-8EXP – For foreign governments, tax-exempt organizations, foreign central banks of issue, and other specific entities

Note: By using the WhCertificate endpoint, you can allow your payees to choose and complete the applicable W-9/W-8 form.

Methods to automate W-9/W-8 collection​

You can automate the W-9/W-8 completion process using three different methods.

1. Payee-Initiated:​

  • RequestByUrl: Generates a unique, secure URL for each payee. You can embed this URL as an iframe into your software/vendor portal, allowing each payee to complete their W-9/W-8 forms individually.
  • RequestByBusinessURL: Provides a single public URL for a specific payer (or DBA). You can embed this in your website or send it to your payees via email, enabling multiple payees to complete their W-9/W-8 forms using the same link.

2. Payer-Initiated:​

  • RequestByEmail: In this method, you can use the API to send email requests directly to the payees for the completion of the W-9/W-8 form. Your payees will receive an email with a secure URL to complete their form.

3. Drop-In UI:​

TaxBandits API offers a readymade Form W-9 interface that can be tailored to align with your brand and integrated easily into your existing systems. Learn more

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If the same payees or recipients work with multiple payers, you don’t need to request a W-9/W-8 separately for each one. Instead, you can collect the form once for a payer and then map it to other payers using the LinkWhCertificate endpoint.

Automate TIN Matching with W-9 requests​

You can enable automatic TIN Matching when collecting W-9 forms to validate payee Name/TINs with the IRS.

  • API requests: Set the IsTINMatching node to TRUE when using the RequestByEmail, RequestByUrl, or RequestByBusinessUrl endpoints.
  • Drop-In UI: Configure the settings so that TIN Matching starts automatically once the payee submits their form.

Once TIN Matching is completed, TaxBandits will send you the status via webhooks (if configured). If the TIN Matching fails, the W-9 will be marked as invalid, and you should request a new W-9 from your payee.

Note: TIN Matching is applicable only to W-9 forms and not to W-8 forms.

Customization Options​

Before you automate the W-9/W-8 collection using the TaxBandits API, you can customize the secure URL (form completion page) and the email sent to recipients (when using RequestByEmail) with your own branding. See how

Webhooks Configuration​

In order to receive status updates regarding your W-9/W-8 requests, you can configure Webhooks for the respective event type based on the form type (W-9 or W-8BEN, or WhCertificate) request method you use. Here are the applicable webhook event types for the W-9/W-8 process.

The webhook notification will include the TIN Matching status if you’ve opted for it in your W-9/W8 request.

Note: As an alternative to webhooks, you can use the Status endpoint to retrieve the status of your W-9/W-8 requests.