IRS Taxes

If you own an LLC and are filling out IRS Form W-9 for the first time, you might get stuck on this section near the beginning of the form:

IRS Form W-9 states “Check appropriate box for federal tax classification” and the options include: Individual/sole proprietor, C Corporation, S Corporation, Partnership, Trust/estate, Limited liability company, and Other.

Tax From W-9

If a business is an LLC, here is how to answer the section of W9 above:

  1. If an LLC has elected to be taxed as an S corporation (by filing IRS Form 2553), the LLC’s tax status is “S corporation,” so check “Limited Liabiltiy Company” and write S in the blank to the right.
  2. If an LLC has elected to be taxed as a C corporation (by filing IRS Form 8832), the LLC’s tax status is “C corporation,” so check “Limited Liabiltiy Company” and write C in the blank to the right.

If the LLC has not filed forms to elect to be taxed as either an S Corporation or C Corporation, these default rules apply:

  1. If an LLC has one owner, the LLC’s default tax status is a disregarded entity.  A disregarded entity is any business that is considered separate from its owner for legal purposes but not for taxation.  If a single-member LLC does not affirmatively elect to be taxed as a corporation, it will be taxed as though the business is a sole proprietorship.

To complete this portion of the W9, fill in your personal name in the Name block, your company’s name in the Business name block, your company’s address in the address block, and check the box labeled: “Individual/sole proprietor.”

  1. If an LLC has two owners, the LLC’s default tax status is “partnership.” So check LLC, and enter P for Partnership.

If your LLC is owned by a business (such as another LLC), these guides do not apply. If your LLC is owned by a business, please note that you should see the instructions for this form or consult with a tax professional such as a CPA or tax attorney.

Leave a Public Comment

  • KT
    June 13, 2014, 10:29 pm

    Thanks – very helpful! I was about to fill this out incorrectly. That would have been annoying. (since this is the first w-9 I’m doing for my new-ish company)
    LLC as a sole member so – filling the form out as an individual / sole proprietor.

  • Anonymous
    May 9, 2014, 3:26 am

    Just wanted to say thanks for clearing all this up. Very helpful for this new consultant!

  • Isaac Ibarra
    May 2, 2014, 4:27 pm

    I’m very confused and just when I think I got it straight, I’m confused even more. We started a LLC business. I say “We” because as owner is I guess you can say my partners name but I am down as a “member”. On the W-9 form, what box is the correct one I should mark!?!? Please if anyone can help me with the correct answer and keep me from pulling out my hair, I will be very grateful. .

  • Kenny
    May 16, 2013, 2:04 pm

    I am an independent consultant who is a single member LLC and have always denoted myself as an “Individual/Sole Proprietor” on the W9.

    That being said, the company I’m currently contracting with has hired a staffing firm to handle contingency billing and payroll. The staff company is requesting that I submit a W9 denoting myself as an “LLC” vs. “Individual/Sole Proprietor” for “set-up purposes within their systems”.

    I’m not sure I should be comfortable with this. Thoughts?

  • Aaron D. Hall
    February 6, 2013, 3:44 pm
    Aaron D. Hall

    Natalie and Laura, great points. We have corrected the article above to reflect the corrections you noted. Thank you very much!

    Aaron Hall
    Attorney

  • Natalie
    February 6, 2013, 2:20 pm

    I agree with Laura’s comments and believe she is correct according to the W-9 instructions:

    I respectfully disagree with your treatment of a single member LLC in completion of the Form W9.

    According to the IRS instructions for Form W9, a single member LLC should list the name of the owner under the “Name” box (and the LLC name under the “Business Name” box) and should mark the appropriate classification of the owner as identified on the “Name” line.

    Therefore, if you are an individual person with a SMLLC you would put your personal name in the “Name” box, your LLC name in the “Business Name” box, and mark “Individual/sole pro” (since the classification of the owner listed – you – is “individual”).

    It states in the instructions to the form on page 2 under the “LLC” section that “If you are an LLC that is disregarded as an entity separate from its owner… do not check the LLC box unless the owner of the LLC… is another LLC that is not disregarded for federal tax purposes.”

  • Jesse
    January 30, 2013, 4:49 pm

    Have a look at your page in Firefox version 18. The “related posts” are printed on top of other stuff, making it hard to read

  • Tiye Howell
    December 24, 2012, 7:31 pm

    Okay, I am a bit confused. Christopher, I am a single member LLc, but I have employees working under me. Would I still fill this out the same way as you stated? I am a first time bussiness owner and I have no clue. Please help. Thanks

  • Christopher Bartling
    December 3, 2012, 5:47 pm

    Helpful advice! Thanks for posting this. We had a discussion today at our start-up around this very topic.

  • Laura
    September 25, 2012, 2:47 pm

    I respectfully disagree with your treatment of a single member LLC in completion of the Form W9.

    According to the IRS instructions for Form W9, a single member LLC should list the name of the owner under the “Name” box (and the LLC name under the “Business Name” box) and should mark the appropriate classification of the owner as identified on the “Name” line.

    Therefore, if you are an individual person with a SMLLC you would put your personal name in the “Name” box, your LLC name in the “Business Name” box, and mark “Individual/sole pro” (since the classification of the owner listed – you – is “individual”).

    It states in the instructions to the form on page 2 under the “LLC” section that “If you are an LLC that is disregarded as an entity separate from its owner… do not check the LLC box unless the owner of the LLC… is another LLC that is not disregarded for federal tax purposes.”

  • Travis Van Slooten
    August 20, 2012, 6:23 pm

    Aaron:

    Thanks for posting this! You just saved me time (and potentially money) from having to call my accountant to figure this out. I’m so glad our tax code is so simple to navigate…lol.

    Travis Van Slooten

  • Brittan Pittman
    August 2, 2012, 5:15 pm

    I fall under this category:
    If an LLC has two owners, the LLC’s default tax status is “partnership.” So check LLC, and enter P for Partnership.

    But it’s asking for my TIN and EIN…I have a TIN but it is 12 numbers long and does not fit. I’m not sure where to get my EIN, I’ve never used that before. Can you help me out?

    Brittan