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Old 02-27-2019, 05:12 AM
 
599 posts, read 179,159 times
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I belong to a hobby club. We are not a “non profit” status club....we don’t qualify because our membership dues are minimal... we dont see any benefit to set up non profit 501 we dont try to purchase supplies at wholesale, we dont expect to be able to purchase supplies tax-free, members gladly DONATE supplies etc .
( we collect around $400 per year to cover minimal expenses such as meeting room rental).

We have around $2000 in our checking account and we want to hire a speaker for $1300 . The speaker is a professional in our hobby and she is requiring a 1099 to document her speaker fee. Won’t a check suffice ? Our checking account is set up in the Club name.
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Old 02-27-2019, 08:24 AM
 
Location: East of Seattle since 1992, originally from SF Bay Area
28,995 posts, read 52,498,077 times
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The IRS requires a 1099 for any business paying for a product or service over $600. The speaker is probably assuming that you are a formal organization falling under that requirement, and the club check tends to confirm that. In order to open a bank account in a fictitious name (the club) you would need a Tax ID Number/ Employer ID Number for the organization. That makes you a business. As a business, the speaker is trying to avoid any red flags that will interest the IRS. If you made the check out to an individual and had them write a personal check for the amount the speaker might forego the 1099 since it would be clearly paid by an individual.
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Old 02-27-2019, 09:24 AM
 
8,981 posts, read 11,057,152 times
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Quote:
Originally Posted by STLgaltoo View Post
Won’t a check suffice ? Our checking account is set up in the Club name.
Not to the IRS! Just curious why is it such a big deal to issue a 1099?
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Old 02-27-2019, 09:53 AM
 
327 posts, read 201,409 times
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Quote:
Originally Posted by Hemlock140 View Post
The IRS requires a 1099 for any business paying for a product or service over $600. The speaker is probably assuming that you are a formal organization falling under that requirement, and the club check tends to confirm that. In order to open a bank account in a fictitious name (the club) you would need a Tax ID Number/ Employer ID Number for the organization. That makes you a business. As a business, the speaker is trying to avoid any red flags that will interest the IRS. If you made the check out to an individual and had them write a personal check for the amount the speaker might forego the 1099 since it would be clearly paid by an individual.
Not quite. If you are paying for a product (merchandise) you do not have to file a 1099. Also if the payee is incorporated you do not have to file a 1099. Quite a few other exceptions too.

https://www.cmich.edu/fas/fsr/cps/Do...20Or%20Not.pdf
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Old 02-27-2019, 10:34 PM
 
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The OP specifically stated they are not a not for profit entity, thus the exemptions that apply to non profit educational institutions does not apply to a for profit entity.
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Old Yesterday, 06:04 AM
 
327 posts, read 201,409 times
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Quote:
Originally Posted by Rabrrita View Post
The OP specifically stated they are not a not for profit entity, thus the exemptions that apply to non profit educational institutions does not apply to a for profit entity.
If you are referring to my post the exemptions I mentioned are not limited to non profits.
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Old Today, 10:55 PM
 
8,981 posts, read 11,057,152 times
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But I can't find anything on the IRS instructions or website that states a business is exempt (like a non profit or educational entity) from issuing a 1099 to a non employee who performed speaker services to the business in excess of $600. Add to this the "request" to have the 1099 issued, and I don't see how they can avoid it.
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