Who and when must issue the Form 1099

We would like to remind you that you might need to issue and file a 1099 Form to any unincorporated business or individual due on Jan 31 by law.

The following is a summary of the filing requirements for Forms 1099. Please read this letter carefully and in its entirety. This letter includes information regarding this form.

A form 1099 is due on an annual basis and, as always, the IRS continues to impose stiff penalties for non-compliance or incomplete information. To avoid the penalties, now is the time to begin gathering this information so that the forms can be filed accurately and on time.

If your trade or business makes payments for the following items to any unincorporated business or individual, in the amounts as specified below, a Form 1099 is required:

1. Subcontractors or others providing services - $600 or more.

2. Rents and Commissions - $600 or more.

3. Interest or Dividends - $10 or more.

4. Pension/profit-sharing plans - $10 or more.

5. Direct sales of consumer products of at least $5,000.

6. Payments made to all providers of medical and health care services of at least $600 must be reported regardless of whether the recipient is a professional corporation.

7. All payments to attorneys must be reported regardless of whether the recipient is a professional corporation.

Please print the recipient’s name and address legibly. Please also note that Forms 1099 issued to sole proprietors should be issued in the owner’s name-doing business as, not the name of the company. This is true even if the taxpayer ID number being reported is a Federal Employer ID number.

Backup withholding of 28% is required to be withheld and remitted to the Federal government using Form 945, for persons or entities to whom you are required to issue Form 1099, but who have not provided you with a taxpayer identification number.

We can assist you in preparing these forms on your behalf.
 
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