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    It’s Time for 1099’s

    [fa icon="clock-o"] Jan 9, 2020 2:51:40 PM [fa icon="user"] Cheryl Coyle [fa icon="folder-open'] Financial Management, Bookkeeping, Accounting

    file 1099With the holidays behind you and the beginning of a new year, your small business has an important deadline approaching. If you have paid $600.00 or more to individuals in the form of non-employee compensation you are required to provide a Form 1099 to those by individuals by January 31, 2020.

    What is Nonemployee Compensation?

    Money paid in excess of $600.00 to an independent contractor (a person not on your payroll) who performs work for you is considered nonemployee compensation. Monies paid can include fees, commissions, prizes, or awards for services. Since an independent contractor is not on your payroll, you do not withhold taxes.

    1099 Deadlines for 2019

    The January 31st deadline only applies to Form 1099-MISC with an amount in box 7, Nonemployee Compensation. The filing due date for other Forms 1099 & 1096 remains February 28th, 2020 if filing by paper, and March 31st, 2020.

    Form

    1099 Due Date to Recipients

    Filing to IRS By Mail

    E-Filing to IRS

    1099-MISC (NEC Only)

    January 31, 2020

    January 31, 2020

    January 31, 2020

    1099-MISC (Other Forms)

    January 31, 2020

    February 28, 2020

    March 31, 2020

    1099-DIV

    January 31, 2020

    February 28, 2020

    March 31, 2020

    1099-INT

    January 31, 2020

    February 28, 2020

    March 31, 2020

    1099-R

    January 31, 2020

    February 28, 2020

    March 31, 2020

     

    Below is a quick list you can start to implement now to help relieve some stress regarding 1099’s:

    1. Have a Solid Bookkeeping System – Make sure you have a good set of books to help track expenses and vendor payments. This is something that will not only help with 1099s and tax season, but it can help you better manage and grow your business throughout the year.

    2. Always Collect a W-9 Up Front– Whenever you are paying an outside vendor, regardless of the amount, ask them for a W9. You can then store this on file so it is ready come January.  Many businesses don’t expect to pay someone $600 but after doing a job here and a job there, at the end of the year they pass the $600 mark and forgot to initially grab a W9.

    3. Start Early – don’t wait until the end of January to begin processing 1099’s. The earlier the better.

     

    Don’t know how to file?  Here is another blog to help you OR we do 1099’s for our clients, contact us at kathy@budgetease.biz to see how we can help you.  

    Cheryl Coyle

    Written by Cheryl Coyle

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