When it comes time, one of the most confusing and frustrating forms for a business owner to file seems to be the 1099 forms. It seems like every few years the 1099 form changes, making this form even more exasperating. There are times that a business owner may fail to file their 1099 forms, hoping it won’t catch up to them. However, failing to file the 1099 forms late or not at all will result in penalties ranging from $50 to $110 per form. To avoid penalties and fees, Mark Dicus & Company would like to share the changes and updates to the 1099 form to better help business owners ensure their 1099 forms are filed on time and correctly.
Did 1099 Forms Change?
One of the biggest changes currently made to the 1099 form is that they have been separated into sub form with different names, deadlines and purposes. There are five different sub forms of a 1099 that all businesses owners need to know about. Here are the five different 1099 forms.
What is a Form 1099 NEC?
The 1099-NEC form is needed to report an independent contractor payment for the year. This form is issued to independent contractors, janitorial services, third party accounts and other workers who are paid for services that are not on the company’s payroll. As of the 2021 updates the 1099-NEC form is required for each person that the company paid a minimum of $600 for the year that is not on the company’s payroll. (The 1099-NEC form is not required for personal transactions.)
What is Form 1099-MISC Used For?
The 1099-Misc form is used for other payments over $600 that a payer makes for the operation of their business. This can include rent, prize awards, or income payments. Basically, the 1099-MISC form is money used for the company but not for operational costs.
Do You Need to Report 1099-INT?
The 10099-INT is the tax form that reports on interest income, which was paid by all of the payers to their investors or private lenders at the end of the year. All of the payments made to your lender and investor is filed on the 1099-INT form, so make sure to keep a proper record and separate your payments properly to make it easier to file the different 1099 forms.
Who Must File Form 1099-DIV?
The 1099-DIV form is generally used by major banks and other financial associations. Most businesses unless you are a bank, will not use a 1099-DIV form. However, this form is used to report dividends and other distributions to the taxpayers and or to the IRS.
Do I have to Pay Taxes on a 1099-R?
The 1009-R form is used to report the distributions of pensions, retirement benefits, annuities, IRA or 401k. When a company or entity distributes these types of funds they must file a 1099-R form.
Tax Preparation, Filing, Resolution & More in Summerlin, North LV, Henderson, Lone Mountain Village & Greater Las Vegas, Nevada
Business owners may feel overwhelmed when it comes to organizing and filing all of the different types of 1099 forms. For independent payers or businesses that need help filing their 1099 forms or other accounting services, contact Mark Dicus & Company today.