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Old 10-26-2016, 12:37 PM
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W-9 required by my LLC for reward pass-through?

Hello all, hope my nube aura does not overshadow my question:

User A of my website offers a reward for information. To ensure the reward is actually paid to a User B, who submits the requested information, my LLC collects the offered reward up-front and holds the reward funds until the terms are met, then releases the reward to User B, minus a small administrative fee. The process is similar to how escrow works.

Which party is responsible for obtaining a W-9 Request for Taxpayer Identification Number - User A, or my LLC? The funds are provided by User A and are merely held until they are released to User B (or returned to User A, as the case may be). In most cases, the funds minus the admin fee can be returned to User A, so the funds still technically belong to User A until released to User B.

The business model is still in the concept stages, so I don't yet know if I would be required to file an information return in addition to any other tax filing.

Thanks!



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Old 10-26-2016, 03:25 PM
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Quote:
Originally Posted by Blu3Kn1ght69 View Post

#1Which party is responsible for obtaining a W-9 Request for Taxpayer Identification Number - User A, or my LLC?





#2 The funds are provided by User A and are merely held until they are released to User B (or returned to User A, as the case may be). In most cases, the funds minus the admin fee can be returned to User A, so the funds still technically belong to User A until released to User B.

The business model is still in the concept stages, so I don't yet know if I would be required to file an information return in addition to any other tax filing.

Thanks!
#1 As said user A of your website needs a W9 as user A needs to report the expenses paid to user B on his/her return.

T#2As said above



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Old 10-26-2016, 03:37 PM
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Thank you for your reply. I suppose it would at least be helpful if I facilitated the W-9 between the parties.



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Old 10-26-2016, 03:45 PM
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Thank you for your reply :-)



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