If you’re working as a freelancer or own a small business, you might have heard about something known as IRS 1099 Filing. If you haven’t, it’s important to become more aware of it. Many professionals looking to file their tax forms look for tax services providers online by typing ‘tax service near me‘ on the search engine.
If you are someone seeking to gather more information on taxes, especially form 1099, this article will help you get started. The 1099 form by the IRS is required to be filled out by specific people who are working alone or managing a business by themselves. Here are a few details on the form criteria for filling it, along with what the form entails and how you can fill it out.
What Is A 1099 Filing?
An information filing form, otherwise known as 1099, is used for federal tax purposes. It is used to report specific incomes (not deriving from their salary) that an individual has earned throughout the financial year.
There are around twenty types of 1099 forms, and depending on what type of income you have earned, you might need to fill out a specific one. They are required forms that enable the IRS to track what you’re earning that isn’t reported in your salaried income.
Who Needs to Fill It?
If you are a business owner, a freelancer, or an independent contractor, the form needs to be filled out by you. Further, if you receive dividends from shares or stocks you’ve invested in, you will need to fill out the form. Any person who has earned more than $600 through other sources will need to fill out this form.
Depending on how much you’ve earned throughout the financial year, you might be required to fill out just one 1099 form or various 1099 forms. Even if you haven’t filled out a 1099 form, you will still need to pay taxes on the income earned from sources other than your salary.
As mentioned before, there are currently twenty types of 1099 forms to be filled and submitted to the IRS. You might have to look for a ‘tax service near me’ if you’re getting confused about which form to fill out.
Some of the standard 1099 forms that are filled out every year include:
- 1099-NEC: If a company pays a non-employee more than $600, this form should be filled out. Individuals who have done freelance work or any work that earned them more than $600 also need to fill it.
- 1099-MISC: For income that is outside the purview of the other 1099 forms.
- 1099-S: For real estate deals (if a sale was closed or exchanged). You will need to ask a professional as some real estate deals don’t need to be taxed.
- 1099-INT: If an individual has earned $10+ in interest during a financial year. Banks, investment firms, and other companies will send out this form to the individual if they fulfill the criterion.
- 1099-G: If a person has received money from the state, federal, or national government. It can include unemployment benefits.
How Can You Stay Compliant
When you’re unsure whether you’re supposed to fill out 1099 forms, it’s best to consult a professional about it. If you have been given a 1099 form from a bank, company, or another place, it might be advisable to fill it out.
Be mindful that you are still supposed to pay taxes on income that’s being earned, even if you’re not filing a 1099 form. The form is simply a way for the IRS to be informed on what you’re earning income from and make it legitimate. If the IRS receives a 1099 from a company but doesn’t receive it from you, you will receive a letter that conveys that to you.
If you’re planning on filling out a 1099 form, it’s best to stay on top of these things. If you’re moving to a new address, make sure everyone who can send you a 1099 form knows about it. The IRS would not pay attention to why you couldn’t fill out a 1099 before but fine you for the delay or non-payment.
The deadline for most 1099 forms is around January, while others are due in February. Whenever some information seems inconsistent, it’s crucial to inform the IRS of the same, so you don’t come under scrutiny later.
When To Look For Help
Knowing when and which 1099 form to fill out can be stressful. On top of your regular taxes, when you have to take care of this aspect, too, it can be pretty time-consuming. When you’re looking to save yourself the hassle, it might be a good idea to search for a ‘tax service near me’ and find a professional.
When looking for a professional, ensure you outline your requirements from the start, so there’s no room for confusion. Find someone who matches your requirements and can get things done efficiently. Make your next tax season simpler when you know all about 1099 forms.