With tax season around the corner, preparing and filling 1099s can be time-consuming and tedious. Avoid being penalized! Save hours of time filling out 1099s by starting as early as now!
This is a mandatory tax form that all businesses are required to file. It can be a headache to track and file especially if you have a lot of vendors and independent contractors.
What is Form 1099 exactly?
Form 1099 is an “information return” related to different types of taxable income you have received throughout the year. This includes rent, royalties, medical & healthcare payments, as well as other payments made to non-employees. Simply put, a Form 1099 notifies the IRS that you have actually paid a certain amount of money to your vendors.
As a business owner, you will often use the Form 1099-MISC to report payments made to independent contractors. For you to complete this report, your vendors have to submit a W9 form (also known as a Request for Taxpayer Identification Number) to you. If you have not done this regularly throughout the year, catching up on your W9 collection can take time and lots of follow up with your vendors.
Difference with W-2 Forms
Form W-2 reports wages, salaries and tips. This is used for hired employees. Form 1099 (particularly Form 1099-MISC) is used for independent contractors
Our Form 1099 Services
Vertaccount believes that getting a head start on this process is the best practice. Form 1099 Preparation is time-consuming and requires a lot of follow-up and coordination with your vendors.
- Help identify 1099 vendors to ensure no one is missed.
- Compilation of Form W9s to ensure IRS compliance.
- Identification of payments made to vendors.
- Identification of non-income payments to prevent double reporting of income! (e.g. reimbursements)
- TIN matching with the IRS to minimize IRS penalties.
- What is recorded in your books as a cash payment maybe a reimbursement to the eyes of your vendor. What is classified as an income may actually be an expense. Discrepancies like this do occur especially when dealing with multiple vendors. These may cause inaccuracies in the Form 1099s filed.
- To avoid such errors, it is best to confirm with vendors that payments recorded are indeed accurate. We can email and call your vendors to ensure that your records of payments match.
Hurry and get ahead! Don’t get stuck with your Form 1099s. Fill out the form below and our 1099 Team will be in touch.