Hi, I'm Beth Hochberg CPAC JMA. We're getting close to the end of 2018, so I figured it's a good time to start talking about 1099 forms. There are a lot of different kinds of 1099, but for small businesses, the one you're concerned with is a 1099 miscellaneous. In recent years, the IRS has been cracking down on these forms because their matching system allows them to track who isn't paying taxes if they're being paid under the table. So, it's becoming more important for businesses to take a look at these forms, vendors, and see what their filing requirements are. The first objection business owners usually have to filing 1099 is "I don't use subcontractors." That's kind of a misconception as to who needs to receive a 1099. It's not just subcontractors, but any vendor that you pay over $600 and is a certain entity type. So, if you're using someone who is a sole proprietor and you pay them over $600 during the year, they would need to receive a 1099. If you have a vendor that's a partnership and you paid them more than $600 during the year, you would have to give them a 1099. Now, when you get to LLCs, it's a little trickier because it really depends on how they file their own taxes. How would you know that? Well, you're going to get a form W-9 from them, and that's going to have that information. So, you can see what information you're looking for and if you need to file or not. A couple of other tricky things when it comes to filing 1099: if you pay a lawyer or a law firm more than $600 during the year, no matter what type of entity they are, you need to get a 1099. Additionally, your...
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What is 1099-MISC Form: What You Should Know
Form 1099-MISC is used by businesses to report payments received when your company makes taxable transactions. However, the total amount of these payments that are subject to tax is different for each type of transaction. The rules and procedures for reporting this type of income are very similar for small businesses as well as large corporations. For each type of transaction, you must complete a 1099-MISC form. 1. General Types of Payment Payments made to employees or contractors; wages; bonuses; commissions; and compensation received in taxable trades of business to be remitted to the IRS. 2. Capital Gains, Charitable Donations and Dividends Payments made to: An individual's executors; a personal representative paid by will; a beneficiary; 3. Gains from the Sale of Real Estate Payments received when your company sells an actual real estate. Payments received when you receive a benefit from owning a trade or business. Payments received when your property is destroyed or damaged in the course of a federal, state, or local government agency action, such as a riot. Payments received of a charitable nature, including: Payments made for the funeral services of one individual, or that of a deceased or missing ancestor (the executor) or the person's spouse, for which you provide direct funeral-related assistance or 4. Interest from Student Loans Wages, cash advances, or loans made to provide educational assistance to students. 5. Miscellaneous Income Payments received from other sources Payments made as a member of a partnership or as a member of a registered public accounting firm. Payments made when you provide other professional services to your employer. Payments received from suppliers to the United States. Payments received from government contracting or procurement officers in connection with your tax records or the administration of contracts. Payments for tax, estate, and gift plan distributions where your contribution was made solely because of a determination by the IRS, IRONIC, or the Secretary of the Treasury that you are eligible to receive such funds, and it would be a hardship on you to obtain and maintain the records required by the regulations. Payments made when you are not able to work due to the fact that you 6.
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