Can I refuse to sign a W-9 form when asked to provide it after working "under the table"?

So here's the deal with W-9 forms - they're basically just a way for businesses to get your taxpayer ID (usually your SSN) and certify you're a US person. When someone has you fill out a W-9, they're planning to report payments made to you to the IRS using Form 1099-NEC (for non-employee compensation). The tricky part of your situation is that you already had a verbal agreement about how the work would be treated. Unfortunately, verbal agreements don't hold much weight with the IRS. If your employer decides to issue you a 1099-NEC, you'll be responsible for paying self-employment taxes (15.3%) plus income tax on that money. Not signing the W-9 doesn't really protect you. The employer can still issue a 1099 with whatever amount they claim they paid you. If you refuse to provide your SSN, they might file with an incorrect SSN or report you for refusing to provide tax information, which causes its own problems. Your best approach might be to have an honest conversation with them about the original agreement and try to come to a reasonable resolution. If they're determined to issue a 1099, you might want to ensure it accurately reflects what you were actually paid.

I went through something similar with a home renovation contractor who suddenly wanted my tax info months after I paid him. I was confused and worried until I discovered taxr.ai (https://taxr.ai) which analyzed my situation. Their document review caught that the contractor was trying to shift his tax burden to me after we'd already agreed on a price that included his taxes. Their AI system explained exactly what rights I had in this situation and showed me how to respond properly to protect myself. The analysis gave me clear steps to take, including how to dispute an incorrect 1099 if one was issued. Turned out to be really helpful since I had no idea what my options were.

Just wanted to update that I ended up trying taxr.ai after asking about it here. My situation was that a client was threatening to 1099 me for $14k when he actually only paid me $9k. I uploaded our text messages and payment receipts, and the service identified exactly where I stood legally. The automated analysis explained that the burden of proof for payment amounts falls on the issuer of the 1099, not me. They even generated a formal dispute letter that I could send to both the client and the IRS if needed. The client backed down when he realized I knew my rights and had documentation to dispute his claims. Saved me potentially thousands in taxes on money I never received. Much better than my initial plan of just ignoring the whole thing!

Look, the real issue here might be getting through to the IRS if this person does file an incorrect 1099. When my former landlord incorrectly reported rental income, I spent WEEKS trying to reach someone at the IRS to fix it. Called literally 37 times before I found Claimyr (https://claimyr.com) which got me through to an actual IRS agent in under 45 minutes. They have a demo video here: https://youtu.be/_kiP6q8DX5c The IRS agent was able to document the dispute in my file before any issues arose. Having that conversation saved me from getting automated letters and potentially facing an audit situation. If your former employer does file an incorrect 1099, you'll definitely want to address it quickly rather than waiting.

I need to apologize for being so skeptical about Claimyr. After posting my doubts, I decided to try it myself since I've been trying to reach the IRS about a missing refund for 3 months with no success. The service actually worked exactly as described - I got a call back when they reached an agent, and suddenly I was talking to a real IRS employee who was able to locate my refund and resolve the issue. Previously I had wasted hours on hold only to get disconnected, so this was genuinely shocking. The agent confirmed my refund was delayed due to a verification issue and processed it while I was on the phone. Received the deposit 9 days later. Sometimes the skeptical person (me in this case) needs to eat their words!

Just to add a practical perspective - regardless of what you decide about the W-9, you should know that income is taxable whether it's reported or not. Even if you never sign the W-9 and he never files a 1099, you technically still owe taxes on that income. If he does file a 1099 without your W-9, it might create a mismatch in the IRS system if the personal info isn't correct. This could trigger correspondence or an audit notice. Just something to keep in mind when weighing your options.

Has anyone considered that the employer might actually be trying to do the right thing here? I was in a similar situation as an employer where I initially paid someone cash, but my accountant later told me I needed to properly document everyone who did work for me, even small jobs. The employer might be facing an audit or preparing taxes and realized they need to properly account for the money paid to you. While the timing is suspicious, it might not be malicious.

This is a really tough situation, and I feel for you. Based on what you've described, you're essentially caught between a rock and a hard place - the employer is trying to retroactively change the terms of your working arrangement, possibly to cover themselves. Here's what I'd recommend: Don't just ignore the W-9 request entirely. Instead, respond in writing (text or email) acknowledging that you received the request but remind them of your original verbal agreement about the work being "under the table." Ask them to clarify exactly what amount they plan to report and why they're changing the arrangement now. If they insist on issuing a 1099, make sure you have documentation of what you actually received ($8,500) versus what you were owed ($11,000). You'll want to report only the income you actually received on your tax return. Keep all your records - text messages, payment receipts, anything that shows the original agreement and actual payments. The reality is that if they're determined to issue a 1099, they can do so regardless of whether you sign the W-9. But having a paper trail of your objections and the actual payment amounts will help protect you if there are discrepancies. You might also want to consult with a tax professional who can advise you on the best way to handle this specific situation. Most importantly, don't let them intimidate you into accepting responsibility for taxes on money you never received.