1099s Updated Regulations

Subcontractor payments require a 1099 if paid more than $600.00 in a year. Some businesses are required to receive a 1099 as well, while others are exempt from this requirement. So, how do you know who to send one to and who not to? 

Every person and business must complete a W9. You can find a blank copy here. The information provided on this W9 will let you know if they are a recipient. In 2018 the IRS is requiring all 1099 recipients have a current and completed W9 on file with the employer. If you use an accounting firm for this service you will need to supply them to the accounting firm. Our firm requires all 1099 submission to be completed to us by January 10th for processing and mailing. Any 1099 that is mailed past January 31st could be subject to penalties from the Internal Revenue Service. 
This information also applies to rentals. If you pay anyone to do work for your rental property they MUST receive a 1099 in order to use the deduction on your Schedule E. Failure to supply the W9, and 1099 for subcontractor work will be failure to use the deduction. 
For more information regarding these regulations please contact our office for an appointment with one of our licensed tax preparers.