Hiring and managing maintenance vendors: insurance, W-9s, scopes and payment
Before a vendor does paid work at your building, collect three things: a signed Form W-9 so you have their taxpayer ID, a certificate of insurance showing current liability coverage, and a written scope with a price or a not-to-exceed amount. Then pay against invoices tied to work orders, and track yearly totals per vendor so you know who may need a Form 1099-NEC. For payments made in tax years after 2025, the IRS reporting threshold is $2,000.
Get a W-9 before the first payment
Form W-9 is how a vendor gives you their correct taxpayer identification number for information returns you may have to file with the IRS (IRS, About Form W-9). The current revision is dated March 2024. Ask for it before you pay anything, because chasing a W-9 in January from a vendor you paid in May rarely works.
If a vendor will not give you a taxpayer ID and the payment is reportable, the IRS says backup withholding applies, at the current rate of 24 percent (IRS, Backup withholding). In practice, no W-9 means no payment.
Store W-9s securely. They hold Social Security numbers for sole proprietors, so keep them out of shared email threads.
Check the certificate of insurance
A certificate of insurance (COI) is a one-page summary from the vendor's insurer. Read it rather than filing it:
- General liability: confirm it is in force and the limits meet what your own insurer or lender expects. Ask your insurance agent what minimums to require.
- Workers' compensation: if the vendor has employees, an injured worker without coverage can become a claim against you. Rules vary by state.
- Additional insured: ask the vendor to name your LLC as an additional insured on their liability policy for larger jobs.
- Dates: note the expiration date and ask for a new certificate before it lapses.
- Licenses: for plumbing, electrical, gas and HVAC work, check the license with your state or city board.
Write a scope, even for small jobs
A scope can be three lines in a text message. What matters is that it exists before work starts.
- What: "Replace kitchen faucet in 3B with the supplied faucet, check supply lines."
- When: the date, or the deadline from your urgency level.
- Price: a fixed price, or a not-to-exceed amount and a rule to call you before going over it.
- Proof: photos of the finished work with the invoice.
For recurring work such as landscaping, cleaning between tenants or pest control, put a simple service agreement in place with the frequency, price, what is included and how either side can end it.
Pay against invoices, not requests
Pay only from an invoice that names the property, unit and work order number, and pay from the property's own bank account so its books stay clean. Avoid cash. Many owners pay routine invoices on a set schedule, such as net 15, and pay emergency calls promptly to keep good vendors willing to come at night.
Year-end: who gets a 1099-NEC
The IRS instructions say to report payments on Form 1099-NEC or 1099-MISC only when they are made in the course of your trade or business. For tax years beginning after 2025, the threshold for nonemployee compensation increased to $2,000. Payments to corporations are generally exempt, but payments to attorneys for legal services are reported even if the firm is a corporation. Payments purely for merchandise are not reported, while parts supplied as an incidental part of a service are included with the service. Form 1099-NEC is due January 31 (IRS, Instructions for Forms 1099-MISC and 1099-NEC). Whether your rental activity counts as a trade or business is a question for your tax preparer.
Example a made-up owner's LLC pays three vendors in 2026. A plumber who is a sole proprietor gets three invoices of $480, $520 and $450, for $1,450: below $2,000, so no 1099-NEC for that plumber. A painter who is a sole proprietor gets $1,800 and $1,800, for $3,600: at or above $2,000, so a 1099-NEC is due by January 31, 2027. A supply house sells $2,300 of faucets and filters: merchandise, so not reported.
| Vendor | Type | 2026 total | 1099-NEC? |
|---|---|---|---|
| Plumber | Sole proprietor, services | $1,450 | No, under $2,000 |
| Painter | Sole proprietor, services | $3,600 | Yes, by Jan 31, 2027 |
| Supply house | Merchandise only | $2,300 | No, merchandise |
Managing vendors over time
- Keep two vendors per trade so an emergency never depends on one phone number.
- Track days from call to arrival and repeat failures per vendor.
- Review prices yearly against a fresh quote.
- Keep each vendor's W-9, COI expiration date and license number in one row.
Vendors in DoorKeeping
Today, DoorKeeping records vendor payments in each property's books, in expense accounts that match Schedule E, so you can ask your AI app for each vendor's total for the year. At year end DoorKeeping produces the 1099-NEC report from the same books, and you or your tax preparer file the forms. Nothing that moves money happens without your one-tap approval.
Sources
- IRS, About Form W-9, read Oct 29, 2026
- IRS, Instructions for Forms 1099-MISC and 1099-NEC, read Oct 29, 2026
- IRS, Backup withholding, read Oct 29, 2026
Questions
- Do landlords need a W-9 from contractors?
- You need the vendor's taxpayer ID if you may have to file an information return for them, and a W-9 is how you get it. Collecting one before the first payment is simplest.
- What is the 1099-NEC threshold for 2026?
- For tax years beginning after 2025, the IRS threshold for reporting nonemployee compensation on Form 1099-NEC is $2,000, up from $600.
- What insurance should a maintenance contractor have?
- At least general liability, and workers' compensation if they have employees. Ask your insurance agent which limits to require, and check the certificate's expiration date.