- January 12, 2022
Form 1099 is a tax form from the Internal Revenue Service of the United States and helps people to prepare and file an information return to the government, concerning their salaries, wages, and tips. 1099 Forms are referred to as information return forms and are not tax return forms and are used to report payments to independent contractors, to report income from the interest payments, rental property income, payments from dividends, miscellaneous income, and sales proceeds. We can choose to either electronically file the tax form or mail it to the IRS and taxpayers can download the blank 1099 Forms from the IRS website.
IRS Form 1099 – filing requirements
Each of the taxpayers should complete Form 1099 for all of their direct and indirect income returns. Four copies of the IRS tax Form should be made, the first copy goes to the taxpayer, the second Form goes to the payee, one copy should be filed with the IRS and the last should be sent to the state tax department. Those who file more than 250 Form 1099, should report all of them electronically with the IRS. The returns should be filed with the IRS and the copies of the Forms should be sent to the payees by 31st January.
The reporting requirement is imposed for the different 1099 Forms and some variants of these Forms, the payees who receive less than $600 need not file the Form. The businesses are required to submit Form 1099 for every contractor to whom they paid more than $600 for their services during the year.
Different variants of Form 1099 and their special considerations
| Form type | Purpose of the form | The minimum amount for issuing the Form | Who issues the Form | Due date |
| 1099 MISC | Used to report miscellaneous income | $600 for compensations and $10 for royalties | The Form is issued by the payer | January 31st |
| 1099 NEC | Used for reporting non-employee compensation | $600 and above | Payer | January 31st |
| 1099 K | The Form is used to report merchant card and third-party network payments | $600 with no minimum number of transactions | Banks and other payment processors | January 31st |
| 1099 DIV | Used to report dividends and distributions | $ 10 for dividends and $600 for interests | Banks, financial institutions and governmental organizations, and other payers of interest income | January 31st |
| 1099 INT | Interest income is reported in this Form | $10 as interest income | Payers of interest income, generally banks, and financial institutions | January 31st |
| 1099 R | Reports distributions from pensions, annuities, insurance contracts, retirement plans, etc. | $10 | Paid by the custodian | January 31st |
It is important to report all the income returns to the IRS and ensure that they receive them on time to file their tax Forms. If you have not received your Form 1099, then contact the employer and report immediately. If the taxpayer has not received their expected 1099 Form for their income earned, maybe because the business has not filed them, the taxpayer should report it under miscellaneous income.
It is best to contact a tax professional who will help with online tax filing such as tax2efile, to report the taxes as required without errors, to avoid fines and penalties.
