One of the first ones that we must deal with each year is the Form 1099-Misc. Due out by Jan 31 to both the recipient and the IRS, this is a quick deadline and often needed by the recipient to accurately complete their own tax returns.
So, what to do now? So much – and it will make it all the easier in January if you do. Here is a quick list of what you should have ready.
- Review your payments to independent contractors and those that you are unsure of their entity status.
- Make sure that you have up to date form W-9s on file from your vendors. The most recently released form has check boxes for either a single member LLC, or an LLC that is taxed as a regular corporation, an S corporation, or a partnership. You will need this information to accurately send out 1099’s.
- For those that you are missing W-9’s now is the time to request them. Also, be sure to update addresses and entity types.
- Review your accounting software to mark the vendors and gl accounts that may be subject to 1099’s. Remember the general rules are any $600 and greater, to a non-corporate entity should be checked. And don’t forget about those payments made to attorneys. If you paid $600 or more to attorneys in the course of your trade or business, then you need to include them in your W-9 requests, irrespective of their entity type.