Filling out your 1099-Misc for Vendors in 2016
There a several different types of 1099s that exist in the federal 1099 information reporting series. However, one of the most popular forms that small businesses need to file is the Form 1099-MISC.
What is a Form 1099-MISC?
Form 1099-MISC is essentially an information report that is required to be sent to certain recipients who have been paid during the year in the course of a trade or business. A copy of the Form 1099-MISC is also reported to the Internal Revenue Service (and some states) for their records as well. Failure to file a required 1099 may result in denied expense deductions upon audit and additional penalties and fees (typically $30 to $100 per missed filing for federal purposes).
Form 1099-MISC Filing Requirements
Form 1099-MISC is required to be filed in several instances. However, some of the most common examples are as follows:
1099-MISC Filing Exemptions
There are a few cases when Form 1099-MISC does not need to be filed even though it may have met the aforementioned requirements. A few examples are as follows:
Tax Reporting of 1099-MISC
There is now a question on tax returns which specifically ask if a business was required to issue 1099s and if so, whether they were filed. Therefore, the IRS has implemented extra measures to make sure the 1099s are filed and will likely begin strictly enforcing the rules. It is advised to collect a Form W-9 from all vendors so that 1099s can be issued if needed.
Form 1099-MISC Due Date
Form 1099-MISC is due each year to the recipient by January 31st. New this tax year, Form 1099-MISC is now due to the IRS by the January 31st deadline. The new accelerated deadline will help the IRS improve its efforts to spot errors on returns filed by taxpayers.
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