It’s that time of year again for 1099 reporting, so today’s article will give instructions on how to properly file forms.
In the Payer’s Name section, include the business name, address and telephone number. Include your tax ID number (EIN is format of XX-XXXXXXX, Social Security is format XXX-XX-XXXX).
Enter the recipient’s identification number using hyphens in the proper format. When entering the recipient’s name, put the owner’s name first if it is not an entity (a sole proprietorship, etc). You may list the business name below the owner’s name. Include the recipient’s address.
Enter the total subject amount paid in the calendar year under one of the following boxes:
Box 1 Rents: Enter amounts of $600 or more for all types of rents, such as any of the following:
1. Real estate rentals paid for office space.
2. Machine rentals. If the machine rental is part of a contract that includes both the use of the machine and the operator, prorate the rental between the rent of the machine (report that in box 1) and the operator’s charge (report that as nonemployee compensation in box 7).
Box 3 Other Income: Enter income of $600 or more required to be reported that is not reportable in one of the other boxes on the form.
Box 4 Federal Income Tax Withheld: Enter backup withholding (if applicable).
Box 6 Medical and Health Care Payments: Enter payments of $600 or more made in the course of your trade or business to each physician or other supplier or provider of medical or health care services.
Box 7 Nonemployee Compensation: Include fees, commissions, prizes and awards for services performed as a nonemployee.
Once all forms are complete, fill in form 1096 which summarizes the totals of all 1099 MISC forms being submitted. Forms need to be mailed to recipients by January 31, and to the IRS by February 28.
For more detailed instructions, see http://www.irs.gov/pub/irs-pdf/i1099msc.pdf