TMG TAX TIPS:

KNOW THE 1099
REPORTING RULES

1099-MISC reporting rules can be confusing. Learn the requirements and exceptions, as well as some quick tips to make filing easier.

Author: Angelique Lund, JD, CPA

TMG Director of Tax and Estate Planning

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1099-MISC forms reporting rules can be a source of confusion—thanks in part to a variety of changes and updates over the years. Filing 1099-MISC forms to report certain types of payments is an IRS requirement that impacts business owners, landlords, independent contractors, freelancers and others who’re self-employed.

Review the information below to determine if you have any 1099 reporting requirements based on your specific situation. If so, our TMG Tax Team has provided some helpful tips and reminders.

WHAT ARE THE 1099-MISC REPORTING REQUIRMENTS?

Generally speaking, business owners (including owners of rental property) must issue a Form 1099-MISC to each person, vendor or contractor whom you’ve paid at least $600 in:

  • Rents
  • Services performed by someone who is not your employee (including parts and materials)
  • Prizes and awards
  • Attorney fees

WHAT ARE THE EXCEPTIONS?

You will not be required to report such payments to the IRS if any of the following statements are true:

  • The payments were made to a vendor operating as a S-Corporation or C-Corporation (including an LLC taxed as an S-Corporation or C-Corporation). However, if the payments were made to an attorney, this exception does not apply.
  • The payments were made by credit card.
  • The rent payment was paid to or through real estate agents (e.g., property managers) as opposed to being paid directly to the landlord.
  • The payments were for merchandise, freight, storage or similar items.

QUICK TIPS AND REMINDERS

FOR 1099-MISC FORMS FILING
GATHER YOUR INFORMATION EARLY
To complete the required reporting, you’ll need to gather the following information:
  • Vendor/payee’s name, address and taxpayer identification number
  • The total amount paid in 2018
ORDER YOUR FORMS
Unfortunately, 1099-MISC Forms cannot be downloaded from the IRS website. You’ll have to order the forms online or pick them up at an IRS service center or post office.
KNOW THE DEADLINES
Copy A of all 1099-MISC forms and Form 1096 must be submitted to the IRS on or before January 31, 2019. Each vendor/payee should be mailed Copy B of their Form 1099-MISC on or before January 31, 2019. Please note, if you have more than 250 forms to file, you’ll have to file electronically.
PLAN AHEAD FOR NEXT YEAR
If you haven’t already, a best practice is to request a Form W-9 from any vendor you expect to pay more than $600 at the time of doing business with them. This form will provide all the necessary information you’ll need for the 1099 process—making your life easier during filing season!

NEED TAX HELP?

When planning for retirement, you need a focused and experienced eye on your taxes. The Mather Group’s in-house Tax Team provides clients with valuable tax strategies and support. Contact us today to learn more.

The opinions expressed, and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. The opinions and advice expressed in this communication are based on The Mather Group’s research and professional experience and are expressed as of the publishing date of this communication. The Mather Group makes no warranty or representation, express or implied, nor does The Mather Group accept any liability, with respect to the information and data set forth herein. The Mather Group specifically disclaims any duty to update any of the information and data contained in this communication. The information and data in this communication does not constitute legal, tax, accounting, investment, or other professional advice.

The Mather Group

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