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Vendor Setup Procedure

Document Type: Procedure
Version: 1.0
Last Updated: February 2026
Distribute To: AP Team, Project Managers

Purpose​

Establish procedures for setting up new vendors in the accounting system.

When Vendor Setup Required​

  • New material supplier
  • New subcontractor
  • New equipment rental
  • New service provider
  • First-time purchase from vendor

New Vendor Information Required​

Basic Information:​

  • Legal company name
  • DBA (if different)
  • Address (remit-to address)
  • Phone number
  • Email
  • Contact name

Tax Information:​

  • W-9 form (required before payment)
  • Tax ID number (EIN or SSN)
  • Entity type (Corp, LLC, Sole Prop, etc.)

Payment Information:​

  • Payment terms (Net 30, etc.)
  • Payment method preference
  • ACH information (if direct deposit)

Compliance (If Subcontractor):​

  • Insurance certificates
  • Contractor's license
  • Prequalification documents

Vendor Setup Request Form​

================================================================
           NEW VENDOR SETUP REQUEST
================================================================

Date: ______________  Requested By: _________________________

Project: __________________________________________________

================================================================

VENDOR INFORMATION:

Legal Name: ________________________________________________

DBA: ______________________________________________________

Address: __________________________________________________
         __________________________________________________
         __________________________________________________

Phone: ____________________________________________________

Email: ____________________________________________________

Primary Contact: ___________________________________________

Website: __________________________________________________

================================================================

TAX INFORMATION:

☐ W-9 Attached

Tax ID (EIN/SSN): __________________________________________

Entity Type:
☐ Corporation    ☐ S-Corporation    ☐ Partnership
☐ LLC            ☐ Sole Proprietor  ☐ Other: ______________

================================================================

PAYMENT INFORMATION:

Payment Terms: ☐ Net 10  ☐ Net 30  ☐ Net 45  ☐ Other: _______

Payment Method: ☐ Check  ☐ ACH  ☐ Credit Card

Remit-To Address (if different):
___________________________________________________________

ACH (if applicable):
Bank Name: _________________________________________________
Routing #: _________________________________________________
Account #: _________________________________________________

================================================================

VENDOR TYPE:
☐ Material Supplier
☐ Subcontractor
☐ Equipment Rental
☐ Professional Service
☐ Other: __________________________________________________

================================================================

SUBCONTRACTOR ONLY:

☐ Insurance Certificate Attached
☐ License Verified: # _____________________________________
☐ Prequalification Complete

================================================================

Approved By: _______________________  Date: _________________

Entered By: ________________________  Date: _________________

Vendor #: __________________________________________________

================================================================

W-9 Requirements​

What is a W-9?​

  • IRS form requesting taxpayer information
  • Required for 1099 reporting
  • Must have before payment

When Required:​

  • Unincorporated businesses (1099 issued)
  • Corporations (for verification)
  • All new vendors (best practice)

W-9 Must Include:​

  • Legal name
  • Tax classification
  • Taxpayer ID
  • Certification signature

Vendor Setup Process​

Step 1: Receive Request​

  • Complete request form
  • W-9 attached
  • Insurance (if sub)

Step 2: Verify Information​

  • W-9 matches request
  • Address verified
  • License verified (contractors)
  • Insurance adequate (if required)

Step 3: Check for Duplicates​

  • Search existing vendors
  • Check variations of name
  • Verify not already setup

Step 4: Enter in System​

  • Vendor number assigned
  • All fields completed
  • Payment terms set
  • Tax information entered

Step 5: Notify Requestor​

  • Vendor number provided
  • Ready for use

Vendor Maintenance​

Update When:​

  • Address change
  • Contact change
  • Bank information change
  • W-9 update needed
  • Insurance renewal

Annual Review:​

  • Verify information current
  • Update W-9 if older than 3 years
  • Review insurance expiration
  • Inactivate unused vendors

1099 Reporting​

Who Gets a 1099:​

  • Unincorporated businesses
  • Payments ≥ $600 in calendar year
  • For services, rent, other payments

Who Doesn't:​

  • Corporations (usually)
  • Merchandise purchases
  • Freight
  • Storage

Year-End:​

  • Review vendor payments
  • Issue 1099s by January 31
  • File with IRS by deadline
  • Invoice Processing
  • Subcontractor Prequalification
  • Insurance Requirements
  • Purchase Order Process

Template provided by support.construction. Verify tax requirements with accountant.