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Thank you for the article. I spoke with the [licensed] electrician today and got a filled out W9. I have received a W9 from the floor refinishers who worked on two apartments this week. I got a W9 from the fence installation company, and requested a W9 from the deck cleaners, as well as my accountant. I'll get the 1099s for all of these out in January. I appreciate all of those who responded with their experiences and knowledge of this topic.
The 1099 portion of the ACA was repealed on April 14, 2011. In summary:
4/14/2011--Public Law. (This measure has not been amended since it was passed by the House on March 3, 2011.
The summary of that version is repeated here.) Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011 - Amends the Internal Revenue Code to:
(1) repeal requirements for the reporting to the Internal Revenue Service (IRS) of payments of $600 or more to corporations that are not tax-exempt and of gross proceeds paid in consideration for any type of property;
(2) repeal requirements for reporting payments made with respect to rental property which is not part of a trade or business; and
(3) increase the limitation on recapture of excess advance payments of the tax credit for health insurance premiums.
The 1099 portion of the ACA was repealed on April 14, 2011.
I'm sure most are well aware of that. Republicans rushing in to shelter the small buiness tax cheats who were the target of 1099 expansion to begin with. But as the Forbes article pointed out, the question of whether one is operating for gain or profit may still suggest that one is engaged in a trade or business. Those who are engaged in a trade or business have been on the hook for 1099's for many years. This is something to talk over with your people. Or just play it safe and get W-9's and send out 1099's. This isn't anything exotic. Many desktop small business software packages are well equipped to handle it.
We own a small apartment building, and I read a couple of years ago that the IRS was going to require landlords to submit 1099s for payments over $600. So, my partner hired some bozo electrician a few weeks ago, and the bill came to $1750. I checked with my accountant, and sure enough, I've got to issue a 1099 for this. Apparently, I'm supposed to do this any time I pay anyone in excess of $600 in a calendar year. You'd think one of our many tax preparer's would have mentioned this in the past few decades, but it's only coming up now.
My head is now swimming. This would be my first transaction of this size with an individual contractor, but not my first with other entities this year. I paid $4000 to a deck cleaning company, $8000 to the insurance company, a few grand to the electric company, etc. Do I have to submit 1099s for each of them? I'm very confused.
no......
Joe Smith does the work over $600.....yes 1099
Joe Smith Electric, Inc (a company) then no 1099
We own a small apartment building, and I read a couple of years ago that the IRS was going to require landlords to submit 1099s for payments over $600. So, my partner hired some bozo electrician a few weeks ago, and the bill came to $1750. I checked with my accountant, and sure enough, I've got to issue a 1099 for this. Apparently, I'm supposed to do this any time I pay anyone in excess of $600 in a calendar year. You'd think one of our many tax preparer's would have mentioned this in the past few decades, but it's only coming up now.
My head is now swimming. This would be my first transaction of this size with an individual contractor, but not my first with other entities this year. I paid $4000 to a deck cleaning company, $8000 to the insurance company, a few grand to the electric company, etc. Do I have to submit 1099s for each of them? I'm very confused.
The IRS suspended the requirement for individual landlords to issue 1099s. Contrary to other comments in this thread:
1) the 1099 requirement for an owner of rental property was a new IRS proposal, not a long standing rule
2) No 1099 is required from individuals when claiming tax deductible expenses
3) You do not need to issue a 1099 to contractors for personal services
4) 1099s are only required from a business
5) 1099s are only issued by a business to unincorporated contractors; services from corporations are exempt
We own a small apartment building, and I read a couple of years ago that the IRS was going to require landlords to submit 1099s for payments over $600. So, my partner hired some bozo electrician a few weeks ago, and the bill came to $1750. I checked with my accountant, and sure enough, I've got to issue a 1099 for this. Apparently, I'm supposed to do this any time I pay anyone in excess of $600 in a calendar year. You'd think one of our many tax preparer's would have mentioned this in the past few decades, but it's only coming up now.
My head is now swimming. This would be my first transaction of this size with an individual contractor, but not my first with other entities this year. I paid $4000 to a deck cleaning company, $8000 to the insurance company, a few grand to the electric company, etc. Do I have to submit 1099s for each of them? I'm very confused.
Its a fairly new rule on the 600 part. I'd check but I think you need to especially if you write it as expenses.otherwise when you are audited they will check to justify any expenses over the AMOUNT. I had friend who work on contract and when the business got audited they had to provide names and then he got audited and paid a hefty fine for not reporting the income.Its really aimed at people who work under the table so to speak and don't report as income; not so much you. It means auditing for many when they don't report what you report and claim.
The law requiring landlords to provide 1099s to service vendors was repealed.
That requirement was originally intended when new legislation was passed in 2010.
Reporting on 1099s is only required for persons and companies engaged in a trade of business. This includes property management firms, but not individual property owners. So, the original poster of this topic has no 1099 problem. However, anyone handling tax obligations for someone else -- whether an employee or a paid tax preparer -- might want to investigate how to possess proven tax expertise at Moderator cut: URL removed
That rule took effect in 2013. I had to file two last year, one for my gardener and one for my maintenance man. I fixed that this year by asking my PM company to pay all those type of bills so I don't have to file 1099's.
The government continues to devise plans to make sure they don't miss out on a dime.
Originally the rule required you to fill out 1099's for every cent you spent, office supplies, coffee filters, it would have been a nightmare, so they toned it down some.
That rule took effect in 2013. I had to file two last year, one for my gardener and one for my maintenance man. I fixed that this year by asking my PM company to pay all those type of bills so I don't have to file 1099's.
The government continues to devise plans to make sure they don't miss out on a dime.
Originally the rule required you to fill out 1099's for every cent you spent, office supplies, coffee filters, it would have been a nightmare, so they toned it down some.
why allow these contractor's to skimp on their tax bill while the rest of us have to pay out the nose? You ever seen what a contractor claims as income??? Not much...whole bunch of "creative accounting" done.
I've never heard of individuals issuing a 1099 when they buy a big ticket item. Is the principle that a 1099 iis required for B2B =>$600 but not for C2B?
***Now I see (post #17) it's for those engaged in a trade or business e.g. B2B.
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