IRS Form 1099 Reporting Requirements

If you have a trade or business that is reported on a Schedule C (Profit or Loss from Business) or Schedule F(Profit or Loss From Farming) on your individual tax return, you may have payments that need reporting on Form 1099.  The most common types of payments are rents and services.  These are required to be reported if you were paid at least $600 during the calendar year.

On 2011 tax returns, Schedules C and F will contain two new questions: 1.  Did you make any payments in 2011 that would require you to file Form 1099?  2.  If “yes”, did you or will you file all required Forms 1099?

You are required to provide the recipients a 1099 on or before  January 31, 2012.  If you file the 1099s electronically, they are due on or befor April 2, 2012.  If you fail to file a correct information return, you may be subject to a penalty.  This penalty is at least $250 per information return with no maximum penalty.

Penalties may be issued if you:  1.  fail to file timely, 2.  do not include all information, or include misinformation, 3.  file a paper return when an electronic return was required, 4.  fail to report, or report an incorrect, Taxpayer Identification Number, and 5.  fail to file paper forms that are machine readable.

For more information on 1099 Reporting Requirements, call Person CPA Group at (504) 780-8299 for a consultation.

David W Huff, CPA, PFS, MS is a partner at Person CPA Group. He provides clients with tax preparation and consulting services, accounting services, retirement plan and benefit consulting, accounting software technical support and training, and management advisory services. His specialty is helping new businesses organize their operations to maximize tax savings and move quickly from start-up to profitability.  You can reach David by email at: david@personhuffcpa.com