The IRS requires businesses to issue Form 1099 to report certain types of payments made in the course of business. As a general rule, you must issue a Form 1099 if you have paid $600 or more during the calendar year to an:
- A limited liability company treated as a partnership or sole proprietorship
- Corporation (only required for medical and health care payments and/or legal fees paid to attorneys)
These payments include but are not limited to:
- Rental payments for your place of business
- Services (including parts and materials)
- Proceeds paid to attorneys
- Prizes and awards
- Payments to independent contractors, subcontractors, commissions, musicians, etc.
Please note that legal fees paid to individual attorneys or corporate law firms that provide services for your business must receive a 1099 regardless of the amount paid.
If you have not already done so, you should consider forwarding a Form W-9 to any vendor that you have paid more than $600 during the year. This form will provide you with a vendor’s legal name, address, tax identification number and type of entity that are necessary for completion of the Form 1099. It’s a good business practice to forward this Form W-9 to any vendor that you expect to pay more than $600 during the year before you pay them. For your convenience, we have attached a copy of the most recent Form W-9.
Our office can assist you with the preparation of Form 1099. Please provide us with the following information for any Form(s) 1099 that you wish us to prepare by January 15, 2018:
- Copy of Form W-9 received from vendor
- Amount that you paid this vendor during the calendar year of 2017
- Your business contact person’s name and telephone number. (Unless you notify us otherwise, we will use the business telephone number or the number listed on our billing statement and the name of the business owner or person most frequently contacted by us).
If you are unable to provide a copy of the vendor’s Form W-9, please include the following additional information:
- Name of the vendor receiving payment – for sole proprietors and/or single member LLC’s, this is the individual’s name (and business name, if any), for partnerships the legal business name.
- Tax Identification Number – for sole proprietors and/or single member LLC’s this is the social security number or business ID number, for partnerships or corporate law firms it is the employer identification number.
We will not be able to complete your Form(s) 1099 unless you provide the information required. When we have all of the above information, we will also prepare the required IRS transmittal forms. As in previous years, a fee will be charged for this service.
After you receive the completed Form(s) 1099, please review the accuracy of all data. If you do not notify us of an error it will indicate to us that you have determined that all data are correct to the best of your knowledge.
Please note that the deadline for filing these forms is January 31st, 2018 regardless of your method of filing. Penalties may be imposed by the IRS for each Form 1099 that is not issued to the recipient AND filed with the IRS by January 31st.
Need copies of Form W9?