• It’s W-9 and 1099 Season
  • February 3, 2012 | Author: Donna Ray Berkelhammer
  • Law Firm: Sands Anderson PC - Raleigh Office
  • If your business needs to issue a 1099 Form to a contractor or vendor, it is time to get a W-9 Form on file for each entity.  The W-9 gathers the information needed to document 1099 eligibility, the taxpayer ID number, and a current mailing address. The 1099 form must be submitted to the taxpayer by January 31st and to the IRS by February 28th.

    The W-9 form can be downloaded here: http://www.irs.gov/pub/irs-pdf/fw9.pdf

    Who gets a 1099 Form?

    • Non-Employee Compensation or Independent Contractor. Businesses are required to file Form 1099-Misc for amounts of $600 or more paid for repairs, maintenance or other services performed by non-employees.  If you’ve hired carpenters, handymen, plumbers, electricians, accountants, landscapers or paid for other services from non-employees, have the contractor provide a W-9 and issue a 1099-Misc.
    • Rents.  Rents collected in more than $600 in 2011 require a 1099-Misc, unless such rents are collected by a real estate agent.
    • Royalties.  Royalties collected of $10 or more  in 2011 require a 1099-Misc.
    • Gross Proceeds Paid to an Attorney.  If your business paid $600 or more in legal fees (even if it was for another entity), you need to file a 1099.  The exemption from reporting payments made to corporations do not apply to payments for legal services.

    For more information, contact your tax attorney, your CPA or the following IRS Publication: http://www.irs.gov/pub/irs-pdf/i1099msc.pdf