Jul 03 2008
Deadlines Approaching For Filing 1099s For Independent Contractors
While the middle of January may seem a bit early to beginthinking about taxes, 1099-MISC filing deadlines are loomingfor businesses. Generally speaking, IRS 1099-MISC is theform used to report miscellaneous income that you paid topersons during 2004 in the course of your trade or business.
Does This Apply To My Business?
The 1099-MISC forms must be issued to any person that youhave paid at least $600 in rents, services or other incomepayments. Typically, you should issue the form to anyindependent contractor that you paid $600 to during 2004.For example, if you paid a designer $1,500 to build andmaintain a website in 2004 for your business, a 1099-MISCfiling would be required. As with practically any IRSfiling, there are additional situations that require a 1099filing [ex: any fishing boat proceeds], so make sure youcover your bases by looking at the relevant instructions.Generally, you are not required to report payments to acorporation.
When and What Must Be Filed?
The 1099-MISC form is a multi-layered carbon form, so makesure the information you provide appears clearly on all ofthe copies. Once you have filled out the form, you mustprovide Copy B to the person that you are reporting to theIRS by January 31, 2005. Using our previous example, youwould mail Copy B to your website designer before the end ofJanuary.
Copy A of the 1099-MISC form is intended for the IRS. Youare required to file it by February 28, 2005 if you aresending the form by mail. If you prefer to fileelectronically, you have until March 31, 2005 to file theform.
Revealing a particular flair for red tape, the IRS requiresyou to file an additional form if you are filing Copy A ofthe 1099-MISC by mail. In such a situation, you must file an”Annual Summary and Transmittal of U.S. Information Returns”form. This summary is better known as Form 1096 and youshould have already received a copy of it in the mail fromthe IRS.
Where To Find These Forms
To the surprise of many people, the IRS has an excellentwebsite containing information and tax forms.
Unfortunately,the site is fairly useless when it comes to obtaining taxforms that you can actually file. You cannot download anduse any 1099 form from the website. If you try to printforms from the site and use them, you run into two problems.First, the IRS computers will not be able to read the formsand will reject them. Second, it is doubtful that you willbe printing on multi-layered carbon paper, which means youwill have no Copy B of the 1099. Obviously, either situationcan attract unwanted attention from the IRS.
You can order forms from the IRS by calling 1-800-tax-formor ordering them off of the IRS website [do not download].The IRS suggests it typically takes at least two weeks forthe forms to be delivered, but keep in mind that it may takelonger. If you need the forms sooner, you usually can findthem at libraries and post offices.
About the Author: Richard Chapo is CEO of http://www.businesstaxrecovery.com - Obtaining tax refunds for small businesses by finding overlooked tax deductions and credits through a free tax return review. He can be reached at richard@businesstaxrecovery.com.
Source: www.isnare.com
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