Requirements for Filing Form 1099-Misc

A Form 1099-Misc reports certain types of income, other than salary, that aren’t filed on a W-2. If you’re a business owner or independent contractor, determine if you should issue or file Form 1099-Misc. The most common expenses a Form 1099-Misc is issued for are:

  • Services performed for a trade or business by people who are not treated as your employees, are not incorporated and paid at least $600 in the calendar year.  Examples are subcontractors, consultants, professional services such as legal, computer consulting, accounting, cleaning, and lawn care
  • Services of at least $600 paid to attorneys, regardless of entity type
  • Rental expenses, prizes and awards, other income and director fees of at least $600
  • Royalties of at least $10

To issue the 1099s the recipient should provide to you:

  • Tax identification number, which is either your Social Security Number or company Federal Identification Number
  • The name that corresponds with your tax identification number. In order to avoid possible matching notices with the IRS, make sure that the name matches exactly as it is on file with the IRS
  • Street address, city, state and zip

The 2016 Form 1099-Misc reporting nonemployee compensation payments in box 7 is due on or before January 31, 2017 to the IRS and to the recipients.  This is an earlier filing deadline from years past. The earlier due date is an effort by the IRS to prevent tax refund fraud by income matching earlier in the year. Failure to file penalties are $50 to $260 per information return and intentional disregard of filing penalties are $530 per information return with no maximum penalty.

If you have any questions about filing requirements for Form 1099-Misc, contact an Anders advisor.