Do I Need to Send a 1099?Jan 09, 2023
Questions about 1099s? We're doing a deep dive this week! We're kicking it off by answering the basics. Who needs to send a 1099? Who needs to receive a 1099?
We'll be focusing on the 1099-NEC, used for non-employee compensation. There's a three-step process we can use to determine if we need to send a 1099-NEC to a contractor or service paid for through your business.
First, did you pay them more than $600 cumulatively over the course of the year? If not, you don't need to send a 1099. If you did pay them more than that, you need to determine if you paid them by cash, check, ACH transfer, or Zelle. If you didn't, no 1099 for them! If you did, the last thing you need to determine is their tax status; are they taxed as a corporation? If they are, you will not send them a 1099.
In short, if you paid someone more than $600 over the course of the year by cash, check, ACH transfer, or Zelle, and they are NOT taxed as a corporation, you will send them a 1099-NEC.
"If you're an entrepreneur who's just starting out, it can be overwhelming to think about all the responsibilities you have when it comes to financial management and taxes. Even if you've been binging this podcast, implementing all of it can be really stressful if you don't have a clear list of action steps and know exactly what you should be doing right now."
What you'll hear in this episode:
- What is a 1099 and who needs to receive it?
- When you need to send a report to the IRS.
- You need a W-9 for every service provider you hire.
- Are they providing services to your business? Did you pay them over $600?
- Do you need to file the 1099s for all your contractors?
- What if you receive a 1099? What do you do?
Questions about this episode? Text me!: https://my.community.com/shannonweinsteincpa
Chat about this episode in the Keep What You Earn Community – http://keepwhatyouearn.circle.so
See how much you can save with an S Corp: https://www.keepwhatyouearn.com/keep-what-you-earn-s-corp-calculator
Find me on IG @shannonkweinstein
Meet me face-to-face on YouTube: https://www.youtube.com/channel/UCMlIuZsrllp1Uc_MlhriLvQ
Featured in Yahoo Finance! Read more here: https://finance.yahoo.com/news/10-bookkeepers-accountants-watch-2021-113800161.html
The information contained in this podcast is intended for educational purposes only and is not individual tax advice. Please consult a qualified professional before implementing anything you learn.