Payee Types - Detailed Guide
Comprehensive guide to different payee types and when to use each
Every payee is one of four types — Employee, Loan-out, Contractor, or Vendor. The type you pick drives tax treatment, which payroll step the payee is paid through, and what Greenroom collects during setup, so it's worth getting right at creation — type can't be changed afterward (see Changing Payee Type below).
Comparison overview
| Employee | Loan-out | Contractor | Vendor | |
|---|---|---|---|---|
| Tax form | W-4 | W-9 | W-9 | W-9 |
| Tax ID on file | SSN | EIN | SSN | EIN |
| Federal withholding | Yes, by our tax partner | No | No | No |
| Year-end form | W-2 | 1099 | 1099 | 1099 |
| Paid through | Employees & Loan-outs step | Employees & Loan-outs step | Vendors & Contractors step | Vendors & Contractors step |
| Needs a standing pay rate | Yes | Yes, unless on contract / invoice-based payment | Yes, unless on contract / invoice-based payment | No — bills per invoice |
| Employer I-9 attestation | Yes, recorded by your company | No | No | No |
Employee
A worker hired directly and paid W-2, with taxes withheld. You control their schedule and how the work gets done.
Setup: The New payee page asks for the engagement (union, agreement, job title, start date) and for name, email, and phone. One or more pay rates follow on the payee's record, which opens at Representation and Pay once you create the payee. Date of birth, address, tax ID, payment method, and the tax forms are collected afterwards through the start-work packet, which a manager either completes or sends to the payee. Greenroom doesn't collect the I-9 itself: your company completes and keeps it outside Greenroom, then a manager records an employer I-9 attestation on the payee's record. See Adding Payees and Payee Onboarding.
Tax ID: SSN. A manager can enter it in Greenroom, where it's encrypted at rest; a payee completing their own setup never sees an SSN field in Greenroom and enters it in our tax partner's secure tax setup instead, after approval. Either way satisfies payroll readiness: once our tax partner has validated an SSN held there, the checklist reads Tax id kept with our tax partner. See Tax Information.
Withholding: The federal W-4 and any state withholding forms live with our tax partner — Greenroom's own database never stores filing status or withholding allowances. The W-4 doesn't hold up submitting or approving setup, and its start-work packet row reads Recommended before payroll. An employee who hasn't finished it can still be paid: "Until they finish, taxes are withheld at the standard single rate, which can be more than they'd choose." The submit screen lists them under Tax forms not finished. A payroll is still refused for an employee our tax partner reports as blocking payroll. A manager picks one of three ways to handle it: send the payee a link to complete it themselves, transcribe the values from a signed paper W-4 the manager physically holds, or skip it for now. See Tax Information for all three paths.
Loan-out
A worker whose services are billed through their own corporation or LLC — Greenroom pays the business, not the individual.
Loan-outs need an EIN — no exceptions
When you add a payee as a Loan-out, Greenroom asks you to confirm they have an EIN, right under the classification cards. If they're a single-member LLC that files under the owner's own Social Security number, the refusal appears inline beside that choice and Create payee is disabled outright, with guidance naming both routes: "Without one, add them as an employee if they're paid a wage (an actor), or as a contractor if they're paid a fee (a director or designer)." There's no way to create an EIN-less loan-out.
Setup: The New payee page asks for the engagement, that EIN confirmation, the business name, and a contact person's name, email, and phone. Pay rates follow on the payee's record once you create the payee. The EIN itself, business address, and payment method come later in setup, and the payee signs the W-9 with our tax partner in their own setup, before any approval, unless they're marked W-9 not required (see Do all vendors need a W-9?). Articles of incorporation can also be attached but aren't required.
Tax ID: EIN.
Contractor
An individual providing labor or creative services independently — paid gross, with no withholding, and responsible for their own taxes.
Setup: The same as an employee — the engagement, name, email, and phone on the New payee page, then rates on the payee's record. The tax ID and payment method are collected later in setup, and the payee signs the W-9 with our tax partner in their own setup, before any approval, unless they're marked W-9 not required (see Do all vendors need a W-9?). Contractors owe no I-9 and have no employer attestation.
Tax ID: SSN — Greenroom treats contractors as individuals, not businesses, regardless of how they've structured their own affairs.
Vendor
A business providing goods, rentals, or services billed by invoice, rather than labor.
Setup: The New payee page asks for the business name, a contact person, email, and phone. EIN, address, and payment method come later, and the vendor signs the W-9 with our tax partner in their own setup, before any approval, unless they're marked W-9 not required (below). Vendors are the one type that never needs a standing pay rate (they bill per invoice instead); a non-union contractor or loan-out gets the same with Contract / invoice-based payment (see Role & Pay). A vendor can also be added mid-run, from the Vendors & Contractors step — see Vendors & Contractors.
Tax ID: EIN.
Do all vendors need a W-9?
No. A W-9 is required before anyone can receive a 1099, but many vendors aren't 1099-reportable in the first place — common reasons include billing only for goods or merchandise, being incorporated (a C-corp or S-corp), being a government or tax-exempt entity, or being paid under $600 for the year.
Greenroom has a control for exactly this. On any non-employee payee, the Personal info / Business info card carries a W-9 not required checkbox:
For payees who aren’t 1099-reportable — goods only, incorporated, government or tax-exempt. The W-9 stops being a required document, and the 1099 filing preview leaves out their payroll payments from now on, on any payroll not yet approved. A payment our tax partner disburses may still be reported by them. Payments already approved or paid keep the treatment they had. A fee or advance recorded as paid outside Greenroom stays in the preview.
Ticking it reveals a Why field, saved on the payee as the reason for the exemption, so it's documented if anyone ever asks. The picker suggests four reasons — Goods / merchandise only, Incorporated (C-corp / S-corp), Government / tax-exempt, Under $600 this year — but you can type your own; an accountant's judgement isn't a closed set. Clearing the checkbox clears the reason, so a reason can never sit beside an exemption that isn't in force.
The same control appears in Add a vendor payment, which creates a vendor from inside a payroll run, and it defaults to ticked there — a vendor being added mid-run for an invoice is usually one that isn't 1099-reportable.
What ticking it actually does
| Effect | Detail |
|---|---|
| The W-9 stops being required | The row stays on the documents checklist, demoted from required to optional — so you can still upload one voluntarily, which is the safer call anyway. |
| The packet says so | A W-9 in your company's own packet is dropped with the note "W-9 marked not required — [your reason]", and the start-work packet's W-9 row is labelled Not required — W-9 exemption on file, with the badge Not needed, before and after the payee has a record with our tax partner. It doesn't hold the packet open: once everything else is done, the packet reads Complete. If the payee gives our tax partner an EIN anyway, the row reads Complete, with Tax id on file; no W-9 owed. |
| Their setup asks for no W-9 | The payee's own setup checks Tax form (W-9) off with Nothing to sign, and the step reads W-9 not required — exemption on file. with nothing to open. Finish payee setup's Tax form line reads the same, and their setup emails mention only their payment details. |
| Payments stop being 1099-routed | While it's ticked, no line on the payee's payrolls lands in a 1099 bucket: not the lines Greenroom calculates from their pay rates, not a payment line added on the run, and not one added with Add a vendor payment. Saving the payee recalculates each payroll they're on that isn't approved yet, so the 1099 filing preview leaves those payments out. |
| Nothing already approved changes | A payroll already approved or paid isn't recalculated, so its lines keep the treatment they had. The exemption is forward-only, on purpose. |
| What it doesn't cover | A payment our tax partner disburses may still be reported by them, and a fee or advance recorded as paid outside Greenroom stays in the 1099 filing preview. |
The checkbox isn't offered on employees, and the server refuses it for them if it ever arrives: an employee files a W-4, never a W-9, so their packet already drops it on a stronger ground than a choice anyone made.
Collecting a W-9 anyway is still the safer default even when the exemption applies, since it documents which exemption you relied on. Confirm exempt categories with your accountant rather than assuming.
Which type should I choose?
Greenroom's own in-app guidance sorts by how you're paying someone, not their job title — the same role can be a different type depending on whether they're on payroll, paid through a company, or billing you.
| You're paying for… | Examples | Choose |
|---|---|---|
| Someone performing in or working on the show, paid directly | Actors, stage managers, musicians, crew | Employee (W-2) |
| The same kind of work, paid through their corporation (with an EIN) | Actors, stage managers, musicians, crew | Loan-out |
| An independent creative or professional, hired for a result | Directors, choreographers, designers, casting directors, general managers, attorneys, accountants, consultants | Contractor (1099-NEC) |
| Goods or business services, billed by invoice | Rehearsal studios, equipment rentals, printers, housing | Vendor (accounts payable) |
A loan-out and a contractor can look alike on paper. Use Loan-out for performers and crew paid through a corporation; use Contractor for independent creatives paid for a result. When it's genuinely unclear, check with your general manager.
Worker classification has real tax and legal consequences
Consult a tax or legal advisor if you're uncertain about a classification — the wrong type can mean incorrect withholding, benefits problems, and compliance exposure.
Changing Payee Type
There's no edit action for payee type — once a payee is created as an Employee, Loan-out, Contractor, or Vendor, that type is fixed. If a payee was set up with the wrong type, the fix is to create a new payee record with the correct type and archive the old one rather than trying to convert it in place; see Archiving Payees. Sort this out as early as possible — the further into onboarding or payroll a misclassified payee gets, the more cleanup a correction requires.
One person, two classifications
The same rule covers one person who does two kinds of work. Every engagement on a payee is paid and reported under that payee's single classification — Greenroom can't yet hold one person as both a W-2 employee and a 1099 contractor. The payee's Engagement & union card says so, right under the classification: "Every engagement on this payee is paid and reported this way. To pay this person under a different tax classification, use Add payee to create a separate record — Greenroom cannot yet hold one person as both a W-2 employee and a 1099 contractor." So a stage manager on a W-2 union engagement who is also engaged, separately, as a 1099 contractor is two payee records — one per classification, each with its own engagement and rates. Pay each from the record that matches how that work is paid.
Next Steps
Continue with Adding Payees to create payee records, or see Tax Information for details on tax form requirements.