IRS 1099 MISC Form Provisions 2020: Did you make any payments to an individual or a business? If your answer is “Yes”, then you need to file 1099 MISC Form. Form 1099 MISC is an information return form that reports the payments made to independent contractors. Non-profits organizations, qualified pension trusts, or profit-sharing plans require to file 1099 MISC Form.
Doesn’t know about 1099 MISC Form provisions? Don’t worry! We are here to provide you information about whom to furnish 1099 MISC Form, who receives the Form in 2020, and filing 1099 MISC Form online.
What are the rules to furnish 1099 MISC Form?
Following are the rules to furnish 1099 MISC Form:
- Payments made of about $10 or more in royalties or lieu of dividends for tax-exempt interest.
- $600 or more paid as rent, awards, prizes and other income payments.
- Direct sales of at least $5,000 or more of those consumer products designated for resale.
- Income received from any individual from whom the employer, under backup withholding rules, with federal income tax.
Who needs to receive a 1099 MISC Form?
Following are the types of recipients that need to receive a 1099 MISC Form:
- An individual or an LLC that are not taxed as a corporation, provides services for your business in excess of $600.
- Law firms or attorneys who provide legal information for criminal activity, regardless if they’re a corporation or not.
- Payments made as rent to an individual or an LLC of $600 or more for office space, machine rental etc., but not as real estate rents.
Federal 1099 MISC Form exemptions
Following are the circumstances where you don’t need to issue Form 1099 MISC:
- If you paid an independent contractor with a credit card or PayPal for goods and services.
- This form doesn’t include payments made via Cash application, since those methods are not meant to be used for business purposes.
- If you issue Form 1099 MISC for payments you’ve paid for via credit card, you’re essentially double counting this income for the recipient.
- Payments made for physical goods are exempted.
- Don’t include payments made in the course of your personal life, it’s only for business purpose.
How to file 1099 MISC Form online?
Once you’ve determined which contractor will need a 1099 MISC form from you and you’ve acquired their W-9s, you can easily file the forms online. Below steps you need to follow to file Form 1099 MISC online:
- Choose the best IRS authorized e-file provider.
- Create an account on the e-file provider site.
- Add yourself or your business as a payor.
- Take the information from your independent contractor’s W-9 and enter it into the Form one by one, as a new recipient.
- You’ll enter the amount paid in the appropriate box, depending on the type of payment.
- Review your information for accuracy.
- Submit the Form 1099 MISC to the IRS through e-file provider software.
Printable 1099 MISC Form online filing advantages
A basic outline of the advantages of printable 1099 MISC Form online are given below:
Improved security
E-filing 1099 MISC Form lowers the risk by filing Forms directly to the IRS. It removes the middleman from the process and adds security measures that keep your sensitive data safe.
No printing
If you choose e-filing 1099 Forms, you don’t need to print anything. Simply save the forms in PDF format from your e-file site account in a safe place. E-file provider site will print and mail will e-deliver digital copies to your recipients.
No mailing
With e-filing, your e-file provider mails the completed 1099 MISC Form to the IRS. No trips to the post office and no need to purchase more stamps.
Eliminates filing Form 1096
When you e-file 1099 MISC Form, Form 1096 is not required. The e-filing system takes care of summary forms for you. When you file 1099 MISC Form through the e-file provider, you can print summary and total reports that summarize the amounts by paper.
Reuse data year after year
Based on IRS regulations, e-file providers store data for 4 years. If you work with some of the same contractors, you can reuse last year’s data.
What if I don’t file 1099 MISC Form?
If you don’t file a 1099 MISC Form and you’re audited, there’s a chance that the IRS could disallow your deduction. Even if you have proof that you paid the contractor, you may face penalties for not filing Forms.
The following are the penalty details for not filing 1099 MISC Form:
$50 per 1099 MISC Form for late filing after the due date.
Filing 1099 MISC Form after 30 days of the due date may lead to pay $110 per Form.
Pay $280 per 1099 MISC Form when filing after August 1st.
Are you in search of filing 1099 MISC Form online? You can choose us to file your 1099 information returns. We are an IRS certified e-file provider. You can securely file your 1099 MISC Form with the IRS and submit your recipient’s copy online through 1099 NEC pdf.