Posts tagged tax-withholding.
The IRS requires businesses to obtain a Form W-4 from each employee, and also a Form W-9 from contractors and others who may receive payments for services. If a business does not receive these forms, the business must deduct and withhold “back-up withholding” from all wage and other payments to these individuals equal to 24% of the payments (down from 28% prior to 2018). Amounts withheld from an employee/contractor’s payments as back-up withholding are reported on Forms W-2/Form 1099 by the business, and should be reported as federal income tax withheld on the ...