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IRS Form 1099-MISC Instructions for Recipients in 2016

Posted by Admin on 8. February 2017 03:38

The 1099-misc form is used for reporting specific payment types made in business or trade. If you are self-employed or in business, you might have to submit form 1099-MISC to both the business or the person you are making payments to and to the IRS. You can even submit form 1099 online. If you are a businessman or an individual making payments to others then it is necessary for you to remain aware of 1099-MISC instructions. IRS form 1099-MISC instructions will help you in completing and submitting Form 1099 in the best way possible without making any mistakes.

When is Form 1099-MISC Needed?

Trading companies and business will have to fill out a 1099-MISC form for independent contractors, individuals and subcontractors and others in circumstances where:

Payment of $600 or more is made for:

·         Crop insurance proceedings

·         Cash payments to fishermen

·         Proceed payments made to lawyers

·         Health and medical care payments

·         Awards and prizes

·         Services like materials and parts

·         Rents and various other payments type not covered under any other document that reports all sorts of financial information.

Payment of $10 or more is made for:

·                       ·    Royalties, and

·                       ·    Broker payments in lieu of tax-exempt interest or dividends

Such payments need to be reported if the individuals receiving these payments are not corporations. In other words, these payments should be reported if the recipients are partnerships, individuals or limited liability companies treated as sole proprietorships or partnerships. Other different payment types made to corporations need to be reported by making use of Form 1099-MISC.

Form 1099-MISC Instructions- Steps for Preparing Form 1099-MISC

It is necessary for you to request that your contractors, vendors and other recipients of payments submit Form W-9 to you. Form W-9 is important because it will give you the legal address, name and the taxpayer identification number of the vendor. This information is of great importance because it is needed when preparing 1099-MISC form. Further in the form 1099-MISC instructions category, it is necessary for you to keep a track of all the payments that you make in a bookkeeping system. It is important that you know whether the payments fall under the categories that have been listed above. It is also necessary that you know whether the payments that you make to recipients reach the $600 or the $10 threshold. Finally, you must also have an idea about the specific amount that you pay to a recipient during a calendar year.

1099-MISC Deadline and Penalties for Late Filing


You must provide the payment recipient with a copy of Form 1099-MISC by February 1, 2017. The payments should be reported for the 2016 tax year. The IRS should receive Form 1099-MISC by February 28, 2017. You also have the option of filing Form 1099-MISC electronically by March 31, 2017. A 30-day extension for filing 1099 forms with the IRS can be requested by businesses. They can request the extension and file their 1099s using 8809 Form. It is to be noted that an extension should not be treated as the permission to use additional time for providing a recipient with form 1099.

If you are unable to follow the form 1099-MISC instructions properly, you are likely to make mistakes and even fall prey to the penalties of late filing form 1099-MISC. The penalties are as follows:

  • $60 penalty for late payment of form 1099 by 30 days and prior to 1st August.
  • $30 penalty for late payment of form 1099 by 30 days
  • $100 penalty for filing 1099 on or after 1st August.
  • $250 penalty for international filing failure.

When is Form 1099-MISC Due? Who do I send it to?

Posted by Admin on 31. January 2017 06:34

Every business needs some kind of help. Businessmen generally hire people for different operations. For example, graphic designers are hired for creating logos for the business and customer service agents are hired for dealing with the sales. If these individuals are used in the form of contractors, they should be given form 1099-MISC. IRS 1099 MISC form is used by the IRS for businesses to report the payments that they make to people who are not employees but who have been paid in exchange for their services. 

When is 1099 MISC Form Issued?

1099 MISC form is issued to someone in following situations:

  • The contractor is paid $600 or more in 2016 tax year.
  • Minimum $10 is paid in broker payments or royalties in lieu of tax-exempt interest or dividends.
  • $600 or more is paid for services, rents, awards and prizes, health care and medical payments, other income payments, cash payments and payments made for the national principal contract to estates, individuals or partnerships.
  • $600 or more is paid to a lawyer

IRS 1099 MISC is also used for reporting direct sales of minimum $5,000 of different consumer products to buyers for resale anywhere excluding permanent retail establishments. In addition to this, you will have to file form 1099-MISC for every individual from whom you have withheld some kind of federal tax income under backup withholding regulations irrespective of the amount you have paid.

10999 MISC Filing Due Date 2016 tax year

The 1099 MISC should be in the hands of the recipients by 31st January 2017. Nevertheless, if any substitute payments have been made in lieu of any proceeds or dividends to a lawyer, you have time till 15th February 2017 for getting the 1099 forms in the hands of the recipients. An important factor to consider in this circumstance is the mailing time. In case you are filing form 1099-MISC manually and you find no data in Box 7, you have time until 28th February 2017 for getting Copy A to the IRS. You have got time till 31st march, 2017 for getting Copy A to the Internal Revenue Service if you are filing form 1099-MISC electronically and you do not find any data in Box 7. In all circumstances, it is necessary for you to have the correct idea about 1099 MISC deadline. The 1099 MISC filing deadline is important in order to avoid penalties.

Who do I Send Form 1099-MISC? 

As per 1099-MISC instructions, you need to issue the form 1099-MISC to every individual who has received a payment of minimum $600 in services, rents, awards, prizes and other income payments. There is no need to e-file 1099 for personal uses. 1099 online filing is one of the best options that you can go for.

How to Correct a 1099 Form? Steps for 1099 Corrections

Posted by Admin on 20. January 2017 02:49

Form 1099 is basically an IRS or Internal revenue Service form that can be used by the taxpayers for reporting certain payments. There are different varieties of this form available for business owners and common individuals ranging from letters A to SA. Nevertheless, it is important for business owners to make use of Form 1099 MISC for reporting the money that they pay to the independent contractors. This form carries information regarding the business and independent contractor that is being paid the money. In the case of any error in the form, it is necessary for an individual to go for 1099 correction at an instant. There is a definite 1099 corrections deadline within which the revised form should be submitted to the Internet Revenue Service, independent contractor, and the state agencies.

how to correct 1099 form

How to Correct 1099 MISC Form?

1099 misc correction involves identifying the type of mistake or error as the first step. The 1099 correction form errors are of two types and they are Type 1 and Type 2. Type 1 error is incorrect payee name, code or dollar amount and Type 2 error is incorrect or missing taxpayer identification number. It can also be the reporting of an invalid address. Once the type of error is detected, the following steps need to be adhered to for correcting the erroneous information on the form.

  • Confirming the error type.  
  • Referring the original 1099 MISC during the corrections. Right information needs to be included as available on the original form.
  • Obtaining another 1099 form MISC from IRS.
  • Obtaining form 1096 from IRS which summarizes 1099 information.
  • Entering the correct information and checking the”corrected” box right at the top of the form.
  • Completing the correct information on 1096 form.
  • Mailing the revised copy of the form to the IRS and independent contractor.


1099 Form and 1099-MISC deadline for 2016 to 2017

Posted by Admin on 3. October 2016 03:41

1099 forms are related to tax where they are used for reporting various types of payments.  They have certain due dates, after which, they can lead to some severe penalty. These forms are tax documents which are used for reporting some kinds of payments, which are made by financial institutions as well as others, making payments part of their business or trade as per IRS Regulations.

This 1099 filing can be done in two ways. Firstly they can be done manually. Secondly, 1099 filing can be done electronically through the Filing Information Returns Electronically system (FIRE).  These are series of documents which the Internal Revenue Service (IRS) refers by the name of “information returns”. There are various 1099 forms which report the different types of income one may receive the whole year, other than the salary paid by the employer. The entity or the person who makes the payment is responsible for filling out this form and then send it by the 31st of January.

Use of 1099 Forms

Independent contractor income – If someone is working and receiving salary or getting wages, then their employer report their annual earnings on Form W-2 at the year end. However, if someone is an independent contractor or is self-employed, then they will receive an IRS 1099 form from each client who has paid them a specific amount during the financial year. The process for paying 1099-MISC form online is very easy. They are paid electronically through FIRE system. Paying 1099-MISC form online is a good option, as it enables people to process them fast.

Interest and dividend – If someone owns collection mutual fund or stock investments, they will receive an IRS 1099 form for reporting dividends and other incomes from this source. They are not same as the income from the sale of stocks. Rather it is the payment given to shareholders from the profits of the corporation.

1099 Form and 1099-MISC Deadline for 2016







Deadline for 1099 Form

The 1099 filing deadline is extended up to the 16th of February of 2017. However, there has been a new 1099 filing deadline. They must be filed on or before the 31st of January of 2017. If someone who does not meet the deadline, has to face severe penalties for it. If someone is unable to meet the deadline for filing 1099, then they can face penalties. Also, if one is not able to provide reasonable excuses for not meeting the deadline for filing 1099, then they will have to face penalties.

Deadline for 1099-MISC

The 1099 deadline 2017 states, 1st February as the deadline for 1099-MISC. The 1099 deadline 2017 includes March 31 as the deadline for transferring them electronically. Penalties for a deadline varies. For instance, there are different penalties for failing to file at the correct time, an inclusion of incorrect information.

Guide of IRS 1099-MISC Form - Know all about 1099-MISC Box-7 and Box-9

Posted by Admin on 7. January 2015 00:20

Box-7 - Nonemployee Compensation- when an employer pays or compensates or spent a minimum of $600 or more to the consultants or independent contractors who are not employees under him who all could be the service providers during the course of the business for which the payments of $600 or more paid or transacted. The consultant, Independent contractor, or service provider or non-employee could be the receiver of $600 or more for services done as an individual, partnerships, estate, or a corporation including Government agencies or 1099 non-profit organizations.

e-File Form 1099 Now - Click here

Services that are rendered in a non-employee capacity are subject to self-employment tax and include payments made to board-of-director chair holders, attorneys performing services directly for the payee, taxable fringe benefits, and expense reimbursements.

Additionally, payments made for an exchange of services between entities in the course of trade or business, including barter exchanges. Other payment types include golden parachute payments which mean substantial benefits given to a top executive in the event that the company is taken over by another firm and the executive is terminated as a result of the merger or takeover.oil and gas working interests, fish purchases for cash, commissions for lottery ticket sales agents. The corporate exemption does not apply to attorney fees, fish purchases for cash, payments made by a federal executive agency. The standard $600 reporting threshold applies to medical and health care payments made to service providers.

Box-9 -Payer Made Direct Sales of $5000 or more-This includes payments made by door-to-door salespersons, online sellers, telemarketers, direct mailers, and so on. One should not enter a dollar amount in this box. The minimum reporting threshold for this box is $5,000 in annual payments.

Register now for e-filing needs of your tax form 1099-MISC.

What is a Form 1099-MISC and How to File 1099-MISC Form?

Posted by Admin on 24. March 2014 00:23

The miscellaneous income is titled as form-1099-MISC.This federal form 1009 is required to file every year as a year-end report. Employers will provide the independent contractors and other non-employees with this federal contractor form 1009 and so that they are required to file informing the IRS of their federal and state income tax information returns. The recent rulings of IRS are incorporated in the form 1009 in a way suitable for certain players are as follows-

• The taxpayer can now have a foreign address. A taxpayer have an EIN but not in the USA

• Box 11 is new, Foreign tax paid on payments reported on form 1099-MISC. Report this amount in U.S. dollars.

• Box 12 is new. Foreign Country or U.S. Possession for which the foreign tax was paid and reported in box 11.

As IRS through their expert stated that "There were a ton of proposed changes to the 1099-MISC form for the last several years. But those changes were rescinded. A provision in the Affordable Care Act (Obamacare) wanted to change the 1099-MISC form which reports $600 in services to "goods and services". That would have really expanded the use of this form. But the new foreign address and tax paid is growing the form as well."

Who Must File Form 1099-MISC? 

Businesses should provide form 1099-MISC for the current year when paid $600 or more in the past year to individuals, independent contractors, and other businesses. $10 or more paid towards royalties and for some direct and indirect sale of any consumer goods to an agent/wholesaler or retailers for resale to the worth of $5000 or more.

Where to Get 1099 Forms?

Form 1099-MISC must be provided to any "nonemployee" to whom you paid $600 or more during 2011. This includes:

1) Payments for rental property expenses

2) Payments to a physician, physicians' corporation, or another supplier of health and medical services. Issued mainly by medical assistance programs or health and accident insurance plans.

3) Payments for services performed for a trade or business by people not treated as its employees. Examples: fees to subcontractors or directors and important payments. 

4) Fish purchases paid in cash for resale.

5) Crop insurance proceeds

6) Gross proceeds paid to attorneys. (Box 14) (Due to IRS February 15th).

Difference Between W-2 and Form 1099-MISC

Form 1099–MISC is given by businesses to non-employees like independent contractors and other small companies towards payments made no later than January 31st. W-2 is given to employees working for an organization by the employer.

Then the businesses have to submit by e-file 1099-MISC forms to IRS on or before February 28th in a calendar year.  Along with Copy A of all the 1099-MISC forms businesses provided to non-employees, one must submit a Form 1096 transmittal form to the IRS which totals all information from all 1099 forms. One should not use the downloaded 1099-MISC copy A from the internet because Copy A of the 1099-MISC form is in a specific color of red ink and cannot be duplicated.

One can submit all forms of 1099-MISC along with transmittal form 1096 (Annual summary and transmittal of US information returns) to IRS. E-file your Form 1099 Online before 1099 deadline 2017!