Can you help me understand W9, 1099, and what actions I need to take?

The IRS requires companies, as well as individuals, who paid an unincorporated contractor (or service provider) $600 or more in the calendar year, to send a form 1099 to both the IRS and the contractor, indicating the total amount paid to the contractor.

Form W9 is the form that your contractor fills out that provides their name (company or their personal name), classification (type of company), and SS# or EIN.

How does that impact me?

You would need to complete and send a 1099 to any person/firm that provided service (i.e. contractors/professional services) unless they are a C-Corp or S-Corp, as well as file that 1099 with the IRS.

How do I do this?

The general guideline/process is that when you engage a new service provider, you should send them the W9 template and ask them to complete it and send it back to you. If they checked the C Corp or S Corp boxes then you don't need to send a 1099. If they checked any of the other boxes, then you should send a 1099.