renter asking for a W-9

5 Replies

My daughter has been renting a house for a couple of years. She is about to sublet one of the rooms to someone. The new tenant is requesting my daughter fill out a W-9 so the new tenant's employer can pay her rent directly from her employer to my daughter. This sounds odd since my daughter is not the landlord, she pays all the rent to the landlord and is renting one bedroom to the prospective tenant. Any suggestions or input is appreciated.

@Tidal Creek

It sort of makes sense since your daughter is doing the subletting.  She is the new tenant's landlord as the agreement is between your daughter and this new tenant, right?  Or, am i misunderstanding..

The W-9 makes little sense since your daughter isn't going to be an employee.  This should make the rent payments actually earned income subject to payroll taxes and the like in my layman's opinion.  You should consult a professional or two.

Good luck.

If your daughter is subletting, she is the landlord. Suggest she check her own lease to see if she is even allowed to sublet. Most like she isn't allowed to add an occupant without consent of the landlord. If she does sublet, it would be appropriate for her to provide a W-9. While I've never received a 1099 from a tenant, technically you are supposed to provide one to anyone you pay over $600/year to who is not a corporation. Rent paid to a professional property manager does not have to be 1099'd because the PM sends those to the owner (and the IRS). Hopefully this helps!

@David M. -I believe so, but I am not an accountant.  Attached is what Intuit has to say on this subject. The way for your daughter to avoid paying tax is to have the roommate added to the lease.  This is a much safer option also.  Click the link below to see what Intuit has to say on the subject.

What Intuit has to say about subletting income being taxable.

@Patti Robertson

Oh, I read through some of it.  It came to mind that this would be similar if it occurred "one level up."  Its taxable, but as passive income since even subletting should be a categorically a passive event.  For sure, the deductibility would be complex since its renting/subletting a single room.  That's what just came to mind.  Thanks.