1099 Information
What is Form 1099?
Businesses and financial institutions issue Form 1099 to taxpayers. Taxpayers use these 1099s to inform the Internal Revenue Service (IRS) about different types of non-employment income received during the tax year. 1099 income is commonly from compensation for freelance work, but may also include interest from bank accounts or dividends from investments.
Copies of Form 1099 are sent to the IRS and directly to the taxpayer, the income recipient.
- The IRS compares reported income on 1099s with information reported on the taxpayer's Form 1040.
- Financial institutions and small businesses that hire independent contractors complete 1099 forms and send them to their payees.
- Individual taxpayers don’t complete 1099 forms. They complete Form W9.
The IRS has split out Nonemployee Compensation (formerly Box 7 on the 1099-MISC form) into its own form,1099-NEC. You may be required to file two sets of forms if you paid taxpayers for other types of income such as rent, royalties, gross proceeds to attorneys, etc.
The threshold for Nonemployee Compensation is $600 and does not include payments you have made via credit card or PayPal. S-Corp taxpayers do not need to receive 1099s.
What do you need from taxpayers?
W9s need to be collected for recipients (subcontractors, contract labor, rent, and law firms) that meet the filing threshold. Here is a link for the W9 form .
Once W9 information is collected, Form 1099 needs to be appropriately filed (NEC vs MISC with accurate taxpayer information including TINs) and copies submitted to the IRS and taxpayer by the deadline of January 31st.
Let us file for you!
Let us be your partner in ensuring those who need 1099s receive them. We will work with you to collect taxpayer information, file correct forms based on income paid, and timely filing of tax documents.
Our pricing to file 1099-MISCs and 1099-NECs are as follows (postage and handling will be added on for paper filings):
- $100 up to 2 Recipients
- $150 up to 10 Recipients
- For 11+ Recipients, please contact us for a customized quote
1099 Forms have corresponding filing deadlines due to both recipients by January 31st, 2025 regardless of whether filing electronically or by paper.