Tax Compliance Information

IRS Requirement for Independent Contractors

The Internal Revenue Service (IRS) requires Automate America to collect a completed Form W-9 (Request for Taxpayer Identification Number and Certification) from every independent contractor before any payment is issued. This is a federal requirement that applies to all businesses that pay independent contractors.

What Is a W-9 Form?

IRS Form W-9 is the "Request for Taxpayer Identification Number and Certification." It collects your legal name, business name (if applicable), federal tax classification, address, and Taxpayer Identification Number (TIN) — which is either your Social Security Number (SSN) or Employer Identification Number (EIN). By signing a W-9, you certify under penalty of perjury that the information provided is correct.

Why We Collect It

Automate America collects your W-9 for two primary reasons:

• IRS Reporting — We are required to report payments made to you on IRS Form 1099-NEC if you earn $600 or more in a calendar year. Your W-9 provides the TIN we need to file this form accurately.
• Backup Withholding Prevention — Without a valid W-9 on file, we are required by federal law to withhold 24% of your payments as "backup withholding" and remit it to the IRS on your behalf (per IRC § 3406).

When We Collect It

You will be asked to complete a W-9 during your onboarding process on the Automate America platform, before your first payment is issued. If your information changes (name, address, TIN), you must submit an updated W-9 promptly.

How We Store Your W-9

Your W-9 and associated tax information are transmitted using encryption in transit (TLS). Access is strictly limited to authorized personnel with a legitimate business need. W-9 records are retained for a minimum of four (4) years after the end of your business relationship with Automate America, in accordance with IRS record retention requirements, and are securely destroyed thereafter.

Backup Withholding

If you fail to provide a valid W-9, or if the IRS notifies us that the TIN you provided is incorrect, we are required to withhold 24% of your gross payments as backup withholding under IRC § 3406. This amount is remitted to the IRS and may be credited against your federal tax liability when you file your annual return.

Penalty for False Information

By signing Form W-9, you certify under penalty of perjury that your TIN is correct and that you are not subject to backup withholding. Providing false information on a W-9 may result in penalties under Internal Revenue Code § 7206 (fraud and false statements), which can include fines and imprisonment.

What Is a 1099-NEC?

IRS Form 1099-NEC (Nonemployee Compensation) is a tax information return that Automate America is required to file with the IRS and furnish to you. It reports the total gross payments made to you as an independent contractor during the calendar year.

When It Is Issued

Automate America will furnish your 1099-NEC by January 31 of each year for the prior calendar year. For example, a 1099-NEC for earnings in calendar year 2026 will be provided by January 31, 2027.

Who Receives a 1099-NEC

You will receive a 1099-NEC if you earned $600 or more in gross payments from Automate America during the calendar year. Even if you earned less than $600, you are still required to report all income on your federal and state tax returns.

What It Reports

The 1099-NEC reports your total gross payments before any deductions. This means it reflects the full amount Automate America paid you — the rate you saw when you applied, for your approved hours. Automate America's share is taken from the customer's rate before the contract is shown to you; nothing is deducted from what you see. It does not reflect any expenses you may have incurred — those are claimed separately on your tax return.

How to Access Your 1099-NEC

Your 1099-NEC will be available through your Automate America platform dashboard by January 31 of each year. You will also receive a copy via the mailing address on your W-9. If you need a duplicate copy, contact legal@automateamerica.com.

Estimated Tax Payments

As an independent contractor, you are generally required to make quarterly estimated tax payments to the IRS using Form 1040-ES. Unlike employees, taxes are not withheld from your payments (unless backup withholding applies). Failure to make adequate estimated payments may result in an underpayment penalty from the IRS.

Independent Contractor Classification

When you provide services through the Automate America platform, you are engaged as an independent contractor — not an employee of Automate America, Inc. This classification has significant tax implications. Automate America does not withhold federal income tax, state income tax, Social Security tax, or Medicare tax from your payments (unless backup withholding applies as described above).

Self-Employment Tax

As an independent contractor, you are responsible for paying self-employment tax, which covers your Social Security and Medicare contributions. The current self-employment tax rate is 15.3%, consisting of:

• 12.4% for Social Security (on net earnings up to the annual wage base)
• 2.9% for Medicare (on all net earnings, with an additional 0.9% on earnings above $200,000 for single filers)

You may deduct one-half of your self-employment tax when calculating your adjusted gross income.

Quarterly Estimated Tax Payment Deadlines

The IRS requires estimated tax payments on the following schedule:

• April 15 — For income earned January 1 through March 31
• June 15 — For income earned April 1 through May 31
• September 15 — For income earned June 1 through August 31
• January 15 (following year) — For income earned September 1 through December 31

Payments are made using IRS Form 1040-ES. You can pay online at irs.gov/payments, by mail, or through the IRS2Go mobile app.

Business Expense Deductions

As an independent contractor, you may be eligible to deduct ordinary and necessary business expenses on Schedule C of your federal tax return. Common deductible expenses include:

• Tools and equipment used for your contracted work
• Travel expenses including mileage, lodging, and meals while traveling for work
• Home office expenses if you maintain a dedicated workspace (simplified or actual method)
• Continuing education and professional development related to your field
• Professional licenses and certifications required for your work
• Internet and phone expenses used for business purposes (business-use percentage)
• Health insurance premiums (if self-employed and not eligible for employer-sponsored coverage)

Consult a Tax Professional

Tax laws are complex and change frequently. Automate America strongly recommends that you consult a qualified tax professional (CPA, Enrolled Agent, or tax attorney) for advice specific to your individual tax situation. This document is for informational purposes only and does not constitute tax advice.

State Income Tax Requirements

In addition to federal taxes, most states impose their own income tax on earnings. Your state income tax obligations depend on where you reside and where you perform work. States have varying tax rates, filing requirements, and deadlines.

Contractor Responsibility

You are solely responsible for determining your state income tax obligations, filing required state returns, and making any necessary estimated state tax payments. Automate America does not withhold state income taxes from your payments.

Multi-State Work

If you perform work in multiple states through the Automate America platform, you may be required to file income tax returns in each state where you performed services. Some states have reciprocal agreements that may simplify this process. Consult a tax professional familiar with multi-state taxation if you work across state lines.

State Resources

Contact your state's Department of Revenue or Department of Taxation for information about your specific state tax obligations, estimated payment requirements, and filing deadlines.

Questions About This Document

If you have questions about the information in this document, your W-9 submission, or your 1099-NEC, please contact:

• Automate America, Inc.
• Tax Compliance Inquiries: legal@automateamerica.com
• Mailing Address: PO BOX 1638, Greer, SC 29652

IRS Resources

For general information about your tax obligations as an independent contractor:

• Form W-9: irs.gov/forms-pubs/about-form-w-9
• Form 1099-NEC: irs.gov/forms-pubs/about-form-1099-nec
• Self-Employment Tax: irs.gov/businesses/small-businesses-self-employed/self-employment-tax-social-security-and-medicare-taxes
• Estimated Taxes: irs.gov/businesses/small-businesses-self-employed/estimated-taxes
• IRS Free File: irs.gov/filing/free-file-do-your-federal-taxes-for-free

Automate America, Inc.
PO BOX 1638, Greer, SC 29652
legal@automateamerica.com

This document is provided for informational purposes only and does not constitute tax, legal, or financial advice. Automate America, Inc. recommends that all independent contractors consult with a qualified tax professional regarding their specific tax obligations.

Automate America, Inc.
PO BOX 1638, Greer, SC 29652
legal@automateamerica.com