Maintaining a healthy revenue stream is essential to running a profitable medical practice. You obviously want to get paid in a timely fashion from both patients and third-party payers. IRS Form W-9 may be your greatest ally.
First, the basics. The W-9 is a Request for Taxpayer Identification Number and Certification. Generally, businesses use the name, address and Social Security or tax identification number (TIN) from Form W-9 to complete Form 1099-MISC, on which a business is required to report payments made to an independent contractor over the course of the tax year.
When your medical practice submits W-9 forms to insurance companies and other payers, you help guarantee they have the accurate TIN necessary to report income to the IRS. If you want to expedite claims processing, you’ll want to keep your W-9 current.
You’ll want to update your W-9 any time important information changes, including:
- Social Security number
- TIN or Employer identification number (EIN)
- Your name or the practice’s name
- Changes in practice status of “exempt from back-up withholding”
However, it is not necessary to submit a new W-9 for the addition or removal of a physician to a practice—claims will continue to be paid under the practice’s TIN. Nor is it necessary to submit the form for changes to multiple facilities under the same business TIN.
Don’t be surprised if you are asked for different information for the W-9 by different buyers. Some may require different address information, such as the pay-to address versus your physical address. Depending on your business entity structure, the business name may also vary.
Another caveat: In accordance with the IRS instruction on the W-9 form, if a requester has used a form other than a W-9 to request the TIN, you will need to use the customized form as long as it is similar to the IRS Form W-9.
Above all, keep in mind that the IRS can impose penalties on providers who fail to provide the information on the W-9 to a payer, along with subsequent delays in third-party payments. That’s the last thing medical providers need when they want to keep their revenue cycle flowing.
The current Form W-9, revised November 2017, is available on the IRS website.
Goldin Peiser & Peiser works with medical providers on a wide array of services, including tax planning and compliance matters. For more information about our services to medical practices, please contact our medical team or Erick E. Cutler at (214) 635-2541 or by using our contact form below.
Note: This content is accurate as of the date published above and is subject to change. Please seek professional advice before acting on any matter contained in this article.