Get a Jump Start on Form 1099 Reporting

As a business owner you know this is a busy time of year and January is just as busy. You have to close out the books to complete the payroll and the 1099 forms for 2015 by the end of January Why not start the new year out right by being ahead of schedule? How?

You can begin by laying the groundwork right now for the Form 1099-MISC (Miscellaneous Income). Utilizing Form 1099-MISC to report any payments to “non- employees”. This may include payments for things like consulting, web design, legal, or accounting that were paid to independent contractors. Normally you do not need to report payments to corporations. However there are exceptions. For instance, Law Firms, it doesn’t matter if the firm is incorporated or not, you must report all payments. What information will you need to complete Form 1099-MISC?

* Names and addresses. You need this for all the vendors that your business paid fees to.

* Taxpayer ID number. You need one for each vendor.

* Corporate status. You will need verification of each corporation’s status.

The best way to collect this information is to use "Form W-9, Request for Taxpayer Identification Number (TIN) and Certification." Send a copy to all vendors and ask them to complete and return the form to you. When you get the form back, keep it with your records. The IRS doesn't need a copy.  You may save some time in the future by establishing a policy to request Form W-9 from a new vendor whenever you sign a contract.

At Summit CPA we are here to assist you with your tax and financial needs as well as retirement plan audits. Contact our office at (855) 977-7623 to schedule an appointment to find out how we can make your life easier.