As a small business owner, you’re likely to encounter various tax forms and regulations that are crucial for compliance and financial management. One such important document is the 1099 form. This guide will walk you through everything you need to know about 1099 forms, from their definition to the filing process.
What is a 1099 Form?
A 1099 form is a tax document used in the United States to report various types of income other than wages, salaries, and tips (for which Form W-2 is used). It’s primarily used by businesses to report payments made to independent contractors, freelancers, and other non-employees.
How do you determine who receives a 1099?
The 1099 form is typically issued to independent contractors, freelancers, and other individuals or entities who provide services to a business, but are not employees of the business. If you pay someone at least $600 in services, rent, awards, or other income payments during the year, you may need to provide them with a 1099 form.
Who receives a 1099?
Who Does Not Receive a 1099
Due Dates for 1099s
The due date for sending out 1099 forms to recipients is generally before or on February 1st of the year following the tax year in which the income was paid. For filing with the IRS, the due date is typically February 28th if filing by paper, or March 31st if filing electronically.
Different Kinds of 1099s
How to Issue and File a 1099 as a Small Business Owner
Issuing a 1099
Filing with the IRS
What happens if I miss the 1099 filing deadline?
Keep copies of each 1099 you issue for at least four years in case of any queries or audits from the IRS.