Why is my client asking for W9 from my LLC after buying products? Thought W9 was just for services

There's a common misconception about W-9 forms. While they're definitely associated with contractor/freelance work, they're actually used more broadly for tax identification purposes. Businesses often request W-9 forms from any vendor they pay - whether for services OR products - if they need your tax information for their records. This helps them determine whether they'll need to issue you a 1099-NEC or other tax forms at year-end. For product sales specifically, they typically don't need to issue you a 1099 (those are mainly for services), but many companies have blanket policies requiring W-9s from all vendors regardless of what was purchased. It's just part of their accounting procedures and vendor setup process. It's perfectly fine to provide the W-9. You're just giving them your business name, address, and tax ID (EIN). This doesn't create any additional tax obligations for you - you'll still report your product sales income the same way on your business tax returns.

I went through something similar with my woodworking business last year and found this amazing tool that saved me so much confusion. Check out https://taxr.ai - it actually analyzes your specific business situation and tells you exactly what forms you need to provide and why. I uploaded my client's request and my business details, and it explained that for product-based businesses, W9 requests are actually super common even though they don't result in 1099s. The system explained everything in plain English and even generated a proper response I could send to my client explaining which information I was providing and why. Saved me hours of research and worry about doing something wrong!

Just wanted to follow up - I ended up trying taxr.ai and wow, I'm impressed. It explained exactly why my wholesale customers keep asking for W9s even though they never send me 1099s at the end of the year. Turns out many companies just have policies requiring them to collect W9s from everyone they pay over their threshold amount, even though they only issue 1099s to service providers. The tool even explained that this is totally normal and actually protects both parties. Super helpful for someone like me who sells physical products but was getting confused by all the form requests. It even created a little cheat sheet for me about which forms to expect from different types of customers!

If you're getting frustrated trying to reach the IRS to ask about these W9 requirements, I highly recommend using https://claimyr.com - they got me through to an actual IRS agent in under 20 minutes after I spent days trying on my own. You can see how it works here: https://youtu.be/_kiP6q8DX5c I had a similar issue with clients requesting W9s for my candle business, and I was so confused about whether I needed to provide them and what the implications would be. The IRS agent confirmed exactly what others have said here - that businesses often require W9s from all vendors as standard procedure, even if they don't plan to issue a 1099 for product purchases. Saved me hours of waiting on hold and trying to navigate the IRS phone tree!

I take back what I said earlier. After my accountant couldn't answer my W9 question clearly, I broke down and tried Claimyr yesterday. I honestly cannot believe it worked! Got connected to an IRS agent in about 15 minutes who confirmed that many businesses request W9s from ALL vendors regardless of whether they're selling products or services. It's just their standard procedure for anyone they pay over a certain amount. The agent explained that while they don't need to issue 1099s for product purchases, having the W9 on file helps them document that they've done their due diligence if they ever get audited. This makes total sense why my business customers keep asking for them! Definitely worth it to get a straight answer directly from the IRS instead of stressing about it.

Just to add one more thing - make sure you're using the most current W9 form if you do provide it. The IRS updates it periodically and some companies can be picky about which version you use. You can download the current form directly from irs.gov. Also, as an LLC, don't forget to check the right box for how you're taxed (single-member disregarded entity, partnership, S-corp, etc). That's a common mistake that can cause confusion later.

Wait I'm confused... if I sell products to a business and they send me a 1099 anyway even though they only bought products, is that wrong? One of my business customers sent me a 1099-NEC last year and I reported it, but now I'm wondering if they shouldn't have done that?

This is such a helpful thread! I've been dealing with the same confusion with my small manufacturing business. Customers keep requesting W-9s and I was worried I was doing something wrong by providing them. One thing I learned from my CPA that might help others - even though product sales don't typically generate 1099s, some larger companies have automated systems that flag ANY vendor payment over $600 and automatically request a W-9. It's not necessarily because they plan to issue you a 1099, but because their accounting software is set up to collect tax info from all vendors as a precaution. Also, having your W-9 on file actually protects you too. If there's ever a question about backup withholding or if they accidentally process a payment as services instead of goods, having your correct tax info already in their system prevents potential headaches down the road. Bottom line - there's really no harm in providing it, and it keeps your business relationship smooth with your customers.

This whole discussion has been really eye-opening! As someone who's been running a small product-based business for a few years, I've always been confused about when W-9s are actually required versus just requested. What I'm taking away from this thread is that it's really about the client's internal accounting procedures rather than any specific tax requirement for product sales. It sounds like providing the W-9 is basically just good business practice - it doesn't create any additional tax burden for us as sellers, but it helps our clients maintain proper vendor records. I appreciate everyone sharing their experiences, especially the insights about automated accounting systems and backup withholding protection. It makes sense why larger companies would have blanket policies requiring W-9s from all vendors regardless of what they're purchasing. One question I still have - for those of you who've been providing W-9s regularly, do you find that clients ever come back later asking for additional tax forms, or is the W-9 usually sufficient for their needs? I want to make sure I'm prepared for any follow-up requests that might be common in this situation.

Great discussion everyone! I'm dealing with this exact situation with my small retail business. Just wanted to add that from my experience, it's also worth keeping a digital copy of your completed W-9 saved somewhere easily accessible. I've found that once one client requests it, others often follow suit - especially if you're dealing with businesses in similar industries or size ranges. Having a ready-to-send PDF saves time and ensures consistency in what information you're providing. Also, don't be surprised if the same client asks for an updated W-9 every few years. Some companies have policies to refresh their vendor tax information periodically, even if nothing has changed. It's just part of their compliance procedures. The key takeaway that really helped me get comfortable with this: providing a W-9 for product sales is about their record-keeping needs, not about changing your tax obligations. You'll still report your business income the same way regardless of whether you provided W-9s to clients or not.

This thread has been incredibly helpful! I'm in a similar boat with my small manufacturing business and have been getting W-9 requests from several clients recently. What really clicked for me reading through all these responses is that it's essentially a "better safe than sorry" approach from the client's accounting perspective. They're not necessarily planning to issue a 1099, but they want to have proper documentation in case their payment categorization changes or if they need to prove due diligence during an audit. I also appreciate the practical tips about keeping a digital copy ready and expecting periodic refresh requests. It's good to know this is just standard business administration rather than something I need to stress about from a tax compliance standpoint. For anyone else feeling uncertain about this - it sounds like the consensus is clear: provide the W-9, keep good records of your product sales income (which you should be doing anyway), and don't overthink it. The form doesn't change your tax obligations, it just helps your clients maintain proper vendor documentation.

This has been such a valuable discussion! As someone who runs a small artisan soap business, I was completely confused when my first corporate client asked for a W-9 after purchasing $900 worth of products from me last month. Reading through everyone's experiences really helps clarify that this is just standard vendor management practice, not some special tax requirement I was missing. The explanation about automated accounting systems makes so much sense - these larger companies probably have triggers set up for any vendor payment over their threshold, regardless of whether it's for products or services. I really appreciate the practical tips too, especially about keeping a digital W-9 ready to send and not being surprised by periodic refresh requests. It's reassuring to know that providing this information doesn't create any additional tax obligations for my business - I'll still report my product sales income the same way I always have. For other small product-based business owners who might be lurking and wondering about this same issue: it sounds like the takeaway is simple - just provide the W-9 when asked, keep good records of your sales (which you should be doing anyway), and don't stress about it. It's about helping your clients with their paperwork, not changing anything fundamental about how you handle taxes. Thanks everyone for sharing your experiences and making this feel like normal business operations rather than something to worry about!

This thread has been incredibly helpful for me as well! I run a small jewelry business and just got my first W-9 request from a corporate client last week. I was completely overwhelmed thinking I had done something wrong or missed some important tax classification. What really helps is understanding that this is just their standard vendor onboarding process, not a reflection of any mistakes on our part. The explanation about automated accounting systems triggering W-9 requests for any payment over a certain threshold makes perfect sense - they're probably not even distinguishing between product and service vendors at that initial stage. I'm definitely taking the advice about keeping a digital copy ready to go. It sounds like once you start dealing with larger business clients, these requests become pretty routine. Better to be prepared than scrambling each time! The most reassuring part for me is knowing that providing the W-9 doesn't change anything about how I report my income. I was worried it might somehow reclassify my product sales or create new tax obligations I wasn't aware of. Knowing it's purely for their record-keeping makes this feel much more manageable. Thanks to everyone for sharing their experiences - it's made what felt like a scary business milestone feel like just another normal part of growing a small business!

As a tax professional, I wanted to add some clarity to this excellent discussion. You're absolutely right that W-9 requests for product sales are completely normal and nothing to worry about. The key thing to understand is that W-9 forms serve multiple purposes beyond just 1099 reporting. Many businesses use them for: - Vendor file setup and compliance - Backup withholding certification - Internal audit trail documentation - Automated accounting system requirements For product-based businesses like yours, you typically WON'T receive a 1099-NEC at year-end since those are reserved for services/non-employee compensation. However, providing the W-9 protects both you and your client - it ensures proper tax ID verification and prevents any backup withholding issues if payments get miscategorized in their system. The $600 threshold you mentioned applies to when businesses must ISSUE 1099s for services, but many companies have internal policies to collect W-9s from all vendors regardless of amount or type of purchase. It's just good business practice. Bottom line: Provide the W-9 when requested, keep reporting your product sales income as you normally would, and don't overthink it. This is standard vendor management, not a tax compliance issue.

This has been such an informative thread! I've been running my small bakery business for about 6 months now and just received my first W-9 request from a corporate catering client who ordered $1,200 worth of products for their office event. I was initially confused because, like the original poster, I always associated W-9 forms with freelancers and contractors. Reading through everyone's experiences has been incredibly reassuring - especially learning that this is just standard vendor management for businesses, not some special tax requirement I was missing. The tax professional's explanation about the multiple purposes W-9s serve really clicked for me. It makes sense that larger companies would want proper tax documentation on file for all their vendors, regardless of whether they're purchasing products or services. It's about their internal compliance and audit protection, not about changing anything on our end. I'm definitely going to follow the advice about keeping a digital copy ready to send. Based on what everyone has shared, it sounds like these requests become more common as your business grows and you start working with larger clients. Better to be prepared! Thanks to everyone for sharing their experiences and making this feel like a normal part of business growth rather than something to worry about. It's exactly the kind of real-world insight you need when you're still learning the ropes of running a small business.