| The dawning of a new year is also the dawning of the | | | | So, when do these forms have to be filed? Well, there |
| beginning of the tax season. One of the first things you | | | | are two dates. Hey, we are talking about taxes here! |
| need to deal with are 1099 forms. | | | | Actually, there is a good reason. You must send one |
| 1099 forms are IRS documents. They are known as | | | | copy of the 1099-MISC to each independent |
| information tax returns. You do not have to pay any | | | | contractor no later than January 31st. You then must |
| money with them. Instead, they simply tell the IRS what | | | | send the IRS copy to the agency by February 28. |
| you paid to who during the year. The “who” is | | | | So, why the different dates? The one month lag has a |
| generally an independent contractor of some form or | | | | purpose. It gives the contractor the time to check their |
| another for the purposes of this article, to wit, the | | | | records and make sure your number is accurate. If |
| 1099-MISC form. | | | | you underreport what you pay them, they are |
| Filling out the form is a fairly simple process. You just | | | | supposed to call you and report as much. Have fun |
| total up your payments over the tax year to the | | | | waiting for that call! If you over report what you paid |
| various people that you paid, enter their business | | | | them, they will definitely call. Why? The IRS uses the |
| information and the amount. You need to put together | | | | forms to determine if the contractor is reporting all their |
| one form for each contractor. You also need to make | | | | revenues. |
| sure you use the correct form of the…well, form. It | | | | 1099 forms are fairly simple to get out the door. The |
| must be a three piece carbon copy because the IRS | | | | biggest problem you will run into is finding the forms. |
| computers read the information. In practical terms, this | | | | Lots of people have to send them out, so there can |
| means you cannot print it off your computer. You can | | | | be a real rush on them. The IRS offices are almost |
| usually find the form at local post offices and libraries. If | | | | always picked over, but libraries seem to have them in |
| you are feeling brave, you can head down to the local | | | | stock. Regardless, try to get them as soon as possible |
| IRS office as well. | | | | to avoid any problems. |