QUESTION: When are 1099 forms due?
ANSWER: The filing due date is JANUARY 31st- be sure to contact your tax accountant to ensure they have prepared and are submitting prior to the deadline!
As a reminder: a business owner must issue this form to any person you have paid at least $600 in rent, services, prizes, awards or any other income payment during the course of the year. Penalties are minimal ($30-$100 per missed form) and typically we don’t have many in this industry, but the fees increase if you intentionally disregard the requirement.
The list of required vendors/sub-contractors does have some exceptions: you don’t have to send a 1099 to S or C-corps, or partnerships that are taxed as S or C-corps, unless they are a lawyer.
Another exception is if you pay these vendors with a credit card or Paypal- they can be excluded because the 3rd party payment processor will be responsible for issuing the 1099.
There may be times that you or your tax accountant are not sure if the vendor is eligible for a 1099 so it is always best to request a W9 from individuals as soon as you start the relationship. The W9 will specify what type of entity the individual/company is and how they are taxed which will allow your tax accountant to determine whether we should issue and file a 1099.