What to Do When a Vendor Won't Send a W-9
A vendor won't send a W-9? Make the request verifiable, document every ask, and know what IRS rules say about 24% backup withholding and the 1099 TIN box.
When a vendor won't send a W-9, start by removing the reasons to hesitate: make the request easy to verify and give them a secure way to return it. Keep a dated record of every request. If you pay a U.S. contractor reportable nonemployee compensation without a TIN, the IRS says you must backup withhold 24%, and IRS instructions say to leave the TIN box blank on the 1099. AP runs the follow-up; the controller signs off on backup withholding.
General information, not tax or legal advice.
The short answer
- Fix the request first. A request for an SSN or EIN can look like phishing.
- Escalate on a schedule. First ask, reminder, final notice, then backup withholding on reportable payments. The schedule is ours; the withholding rule is the IRS's.
- Policy isn't law. Holding a vendor's payment is a business decision; the IRS rules we cite describe backup withholding, not holding payment.
Why vendors hesitate
A W-9 asks for an SSN or EIN, and vendors are right to be careful. The IRS's 2026 Dirty Dozen warns that tax professionals and businesses remain targets of "new client" or "document request" emails that deliver malicious links or attachments (IRS Dirty Dozen 2026). IRS Publication 4557, a data-security guide written for tax professionals, also says a legitimate business will never ask you to email personal or sensitive information unless it is through a secured mail service (IRS Publication 4557).
Before you escalate, make the request one a careful vendor can say yes to:
- Make it verifiable. The FTC advises verifying any email that requests sensitive information through a separate channel, and not using the links, phone numbers or websites in the email (FTC: Protecting Personal Information). Tell vendors they can call you on a number they already have.
- Use a secure channel. Standard email attachments are usually a poor channel for a W-9, because copies linger in inboxes and get forwarded. We recommend a secure upload link.
- Explain your obligations. IRS instructions require payers to keep W-9 identity information, including SSNs and EINs, confidential, and to use it only to comply with the tax laws (IRS General Instructions for Certain Information Returns).
Our secure W-9 collection guide covers the channel side in depth.
What the IRS says
The vendor's side: penalties for not furnishing a TIN
The W-9 warns payees of a $50 penalty for each failure to furnish a correct TIN, unless there's reasonable cause. A false statement with no reasonable basis that results in no backup withholding carries a $500 penalty, and willful falsification can bring criminal penalties (Form W-9, Rev. March 2024).
Your side: backup withholding
The backup withholding rate is 24% (IRS: Backup withholding). Nonemployee compensation, rents, royalties, commissions, interest, dividends and certain other payments may be subject to backup withholding at 24%.
For contractor pay, the IRS says you must withhold 24% from reportable nonemployee compensation if the payee hasn't provided a TIN as required, or if the IRS notifies you the TIN is incorrect and the payee doesn't certify as the notice requires (IRS: Forms and associated taxes for independent contractors). For payments made in 2026, the general 1099-NEC and 1099-MISC reporting threshold, and the backup withholding threshold, is $2,000 (Instructions for Forms 1099-MISC and 1099-NEC).
The IRS treats a TIN as missing if it isn't provided or is obviously wrong, for example not nine digits or containing letters. Backup withholding applies until you get one (IRS Publication 1281). (Pub 1281 predates the $2,000 threshold, so use it for procedure, not thresholds.)
"Applied For" doesn't pause this for contractor pay. A payee without a TIN can write "Applied For" on the W-9, but the 60-day grace period covers only interest, dividends and certain readily tradable instruments. Nonemployee compensation is subject to backup withholding while the payee waits for a TIN.
If you backup withhold from a vendor, you must file a 1099 for them regardless of the amount paid. Payers report backup withholding on Form 945. A payee who had backup withholding reports it on their tax return for the year they received the income.
When to ask, and how often
You must make an initial request for the payee's TIN when the account is opened or the transaction occurs. If you don't get it, backup withholding begins (26 CFR 301.6724-1). If you didn't get a TIN at onboarding, make a first annual request by December 31 of the year the account opened, or by January 31 for accounts opened in December. If the first annual request fails, make a second one by December 31 of the following year.
When an IRS CP2100 notice lists a missing TIN rather than an incorrect one, don't send a B-notice; use annual solicitations instead.
Records and the 1099
Information return penalties are waived if the failure was due to reasonable cause and not willful neglect. The filer must show mitigating factors or events beyond its control, and that it acted responsibly before and after the failure. A dated log of each request helps you show what you did. If the payee never gives you a TIN, IRS instructions say to leave the recipient TIN box blank on the 1099, and backup withholding may apply.
What the IRS doesn't say
None of the IRS rules above tell you to stop paying a vendor who hasn't sent a W-9; the rule they describe is backup withholding. Holding the whole payment is a business policy. If you choose it, we recommend putting it in your vendor terms and checking it with counsel.
Recommended escalation timeline
This timeline is our recommendation, not an IRS procedure. Run it before the first payment date: backup withholding isn't a step you can postpone once a reportable payment goes out without a TIN. For ready-to-send wording at each stage, use our W-9 request email templates.
From first ask to backup withholding
Day 0: First request (AP)
Send a link to the current IRS form, a secure upload link, and a number they already have for verifying the request.
Day 3 to 5: Reminder and phone call (AP)
Remind the vendor and call on a known number to ask what is holding them up.
Day 10: Final notice (AP, approved by the controller)
State that reportable payments made without a TIN are subject to backup withholding at 24 percent, and give the next payment date.
Payment date: Backup withhold (controller)
If there is still no TIN, withhold on reportable payments and flag the vendor for a 1099. Confirm the mechanics with your tax adviser.
Year end: Annual solicitation (AP)
If the TIN is still missing, make the annual request before the year-end deadline.
Exception path: if a vendor says they aren't a U.S. person, stop the W-9 request. IRS requester instructions tell you to point foreign vendors to the appropriate Form W-8 or Form 8233 (Instructions for the Requester of Form W-9). If a vendor returns a W-9 with "Applied For," route it to the controller before the next payment.
Our year-end W-9 checklist covers the December follow-up.
What to record in your request log
A good practice, not an IRS form: one row per request or follow-up.
| Field | What to record |
|---|---|
| Vendor | Legal name as you know it, and vendor ID |
| Date and time | When the request or follow-up went out |
| Channel and sender | Email with upload link, phone call or letter; who sent it |
| Vendor response | None, question, refusal, "Applied For," form received |
| Next step and date | Reminder, final notice, backup withholding start |
| Payment impact | Payment dates, withholding amounts, who approved |
Restrict access to anything that includes a TIN.
Example scenario
Example scenario: Northfield Books, a made-up firm, handles AP for a landscaper. A new subcontractor ignores the first W-9 email. On day 4, the AP lead calls the number on his printed estimate and learns he thought the email was a scam. By day 10 nothing has arrived, so AP sends a final notice. With no TIN on file when the invoice is due on day 14, the controller approves backup withholding on that reportable payment after checking with the firm's tax adviser. Two weeks later the subcontractor uploads his W-9 (TIN shown as XX-XXXXXXX), and AP logs the date.
Common mistakes
- Treating backup withholding as optional or as the last resort. For reportable contractor pay without a TIN, the IRS says you must withhold.
- Skipping the 1099 because the TIN is missing. If you backup withheld, you must file a 1099 regardless of the amount, and IRS instructions say to leave the TIN box blank.
Checklist
- Request links to the current IRS form and offers a secure upload channel
- First ask, reminder and final notice sent and logged with dates
- Final notice explains backup withholding at 24% on reportable payments
- Withholding reported on Form 945; vendor flagged for a 1099 regardless of amount
- Annual solicitation scheduled before December 31 if the TIN is still missing
Send the current revision of the form; see what's changing on the W-9 and how to request a W-9 from a vendor.
How W9Vault supports this workflow
W9Vault addresses the insecure-looking request. You send the vendor a secure upload link that expires after 7 days, and they upload the completed W-9 as a PDF, JPG or PNG up to 20 MB. Files are encrypted in the vendor's browser before upload, so the server never receives the plaintext file. Your dashboard shows whether each request is sent or completed, so you can see who still needs a follow-up; reminders and your log stay with your team. Uploaded files are automatically deleted 30 days after upload for completed requests, so keep your retained copy in your own records system.
W9Vault is designed to support a secure collection workflow; the customer remains responsible for their own tax, recordkeeping and security obligations.
Give hesitant vendors a safer way to say yes
Send a secure, expiring upload link for the W-9 instead of asking for an email attachment, and see when each request is completed.
Frequently Asked Questions
The IRS rules we cite describe backup withholding, not holding the whole payment. Holding payment is a business policy. If you want one, put it in your vendor terms and check it with counsel.
Not for reportable contractor pay. The 60-day grace period covers only interest, dividends and certain readily tradable instruments, so nonemployee compensation is subject to backup withholding while the payee waits for a TIN.
IRS instructions say to leave the recipient TIN box blank on the 1099 if the payee does not provide a TIN. If you backup withheld, you must file a 1099 for that vendor regardless of the amount paid.
Official resources
- Form W-9, Rev. March 2024 (PDF)
- IRS: Backup withholding
- IRS: Forms and associated taxes for independent contractors
- IRS Publication 1281
- Instructions for Forms 1099-MISC and 1099-NEC
- IRS General Instructions for Certain Information Returns
- Instructions for the Requester of Form W-9
- 26 CFR 301.6724-1
- IRS Publication 4557
- IRS Dirty Dozen 2026
- FTC: Protecting Personal Information
