Stop Chasing Vendors in January. Collect the Damn W-9s Now.
As a business owner, January is already a lot. Wrapping up the year, prepping for taxes, juggling a hundred moving parts. That’s why at Lookout Bookkeeping, we don’t wait until then to think about 1099s. We help our clients stay ahead by requesting W-9 forms throughout the year—as soon as we notice a new vendor being paid.
That one habit? It can save you time, stress, and a headache you really don’t want from the IRS.
What Is a W-9 and Why Does It Matter?
A W-9 gives you the information you need to issue a 1099-NEC to a vendor at year-end—their name, business type, and Taxpayer Identification Number (TIN).
Here’s the updated rule you need to know: Starting in 2026, you’ll need to issue a 1099-NEC to any service provider you pay $2,000 or more during the year—up from the previous $600 threshold. (Note: the $600 threshold still applies to 1099-MISC reporting in certain situations, so when in doubt, collect the W-9 anyway.)
The exception? Incorporated businesses—though even that comes with its own set of rules.
The problem most business owners run into: they wait until tax season to track this stuff down. By then, vendors are unresponsive, unavailable, or just… gone.
Simple rule: collect the W-9 before you pay the vendor. Full stop.
Why Collecting W-9s Up Front Protects You
- You have everything you need when 1099s are due—no scrambling.
- You’re not chasing down unresponsive vendors in the middle of January chaos.
- You protect your deductions if the IRS ever audits your records.
Waiting too long can mean missing forms, delayed filings, and disallowed expenses if the IRS finds no 1099 was filed and no W-9 was collected. Not a fun situation to be in.
How We Handle This for You
At Lookout Bookkeeping, we take a proactive approach. Here’s what happens when we spot a vendor that may need a 1099:
- We ask for the vendor’s email address.
- We send a W-9 request through our secure client portal.
- We notify you once the vendor submits it.
- We send up to three automated reminders if they haven’t responded.
- If we still can’t collect it, we alert you to follow up directly.
We handle the heavy lifting. You focus on running your business—not chasing paperwork.
Your Responsibility as the Business Owner
Even with our help, this ultimately lands on you. The IRS holds business owners accountable for issuing correct 1099s. That means you need to:
- Collect a W-9 from any non-employee service provider you pay $2,000 or more in a calendar year (and honestly, collect one from anyone you pay regularly—thresholds change, and you want the documentation either way).
- Keep those forms on file.
- File a 1099-NEC for each applicable vendor by the IRS deadline.
When in doubt, collect the W-9. It costs you nothing to have it. It can cost you real money not to.
Helpful Resources
Let’s Make Tax Season Not a Nightmare
If you want a simple system for vendor onboarding and W-9 collection, we’d love to help you build it. Staying ahead of tax deadlines doesn’t have to be stressful—with the right team in your corner, it can be seamless.
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