If an individual or business performs services for the university, it must be determined if there is an employee relationship with that vendor, or if they should be considered an “independent contractor”. The IRS has specific guidelines which determine the correct classification. Please direct any questions regarding classification of vendors to business@daemen.edu.
Prior to the first payment to an independent contractor, the vendor should be directed to upload their form W-9 through our secure upload link: www.daemen.edu/w9. Forms are available at www.irs.gov/pub/irs-pdf/fw9.pdf.
Should a vendor be subject to the IRS1099-NEC income reporting, federal law will require us to withhold up to 28% in federal withholding taxes from payments due until we receive a correct tax identification number. If the vendor is an individual, this number is the social security number.
Since W-9 forms contain confidential information, a paper form received by any office must be immediately and securely delivered to the business office. The form may be uploaded via the secure link shown above or directly hand-delivered to a member of the business office staff. Do not send forms in interoffice mail or by email. W-9 forms must be completely filled out and signed to be considered valid.
For subsequent payments to that same independent contractor, it may be simply noted on the purchase requisition: “Information on File with Business Office”. W-9 forms are kept on file in the business office as documentation for any potential audit inquiries.
IRS Form 1099
As per IRS Regulations, Daemen University is obligated to report certain types of payments on a Form 1099-NEC for each calendar year. If it is determined that an individual or business is a non-employee (independent contractor), we must evaluate payments during the calendar year to determine if we must issue a 1099-NEC Form by January 31. If the following four conditions are met, we must issue the form:
- We made the payment to someone who is not our employee.
- We made the payment for services.
- We made the payment to an individual, partnership, estate, or in some cases, a corporation.
- We made payments to the payee of at least $600 during the calendar year.