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|Posted on January 26, 2023 at 2:45 PM|
An overview of the 1099 series forms just in time for the January 31st deadline
By Stephanie Glanville | January 18, 2023 | Read time: 8 minute(s) | Deadline, Form 1099 Series
Whether you are a small business owner or a tax professional filing on behalf of many clients, IRS filing requirements can be extremely time-consuming. If you are not a professional and instead are running a business with many moving parts, tax filing, in general, can be really overwhelming.
Speaking of overwhelming, the Form 1099 series can be intimidating, mainly because there are so many different types of 1099s.
The Form 1099 series is used to report a wide variety of different payments that are made during the year in the course of doing business. Whether you are required to file these forms, or you receive a copy of this form, here is a quick guide to the most common forms in this series.
When Should you File a Form 1099?
Businesses and individuals that make payments to their non-employees during the tax year may be required to file a Form 1099. The most commonly filed Form 1099-NEC is used for non-employee compensation. Businesses must file this for any payments of over $600 made to a freelance worker, independent contractor, or other non-employee.
Businesses that make certain payments during the course of trade are required to file 1099-MISC, some examples of this include payments made to an attorney, rent payments, awards, etc. Banks and financial institutions must also distribute forms to individuals that they have paid interest income, dividends, and more.
Why did I Receive Form 1099?
As opposed to the businesses that file them, the payment recipients are on the receiving end of these forms. Freelance workers will receive a 1099-NEC Form from the businesses they completed work for. Any individual or business that received a miscellaneous payment during the year will receive a copy of 1099-MISC Form from the business that paid them.
Taxpayers may also receive copies of Form 1099-INT or 1099-DIV in regard to income interest or dividend distributions made during the year. Copies of Form 1099 are meant to help the payment recipient report this information on their own personal income tax returns as needed.
So, the short answer is if you receive a 1099 copy, you may need to include this information when reporting income on your annual income tax return.
What are some other Common 1099 Forms?
Here are a few of the most common forms in the 1099 series:
What are the deadlines for filing 1099 Forms?
The deadlines for filing 1099 forms are slightly different depending on the form.
Form 1099-NEC is the outlier, the deadline to file this form with the IRS and distribute copies to recipients is January 31, 2023.
It is also important to note that the deadline to file Form 1099-MISC with the IRS is February 15, 2023, if you reported amounts in boxes 8 or 10. Otherwise, the deadline to file a paper copy with the IRS is February 28, 2023, and the deadline to e-file is March 31, 2023.
For more information about the Form 1099 series, visit www.irs.gov
Can I File an Extension for 1099 Forms?
The simple answer to this question is yes, however, there is a caveat. When it comes to Form 1099-NEC for non-employee compensation, the chances of getting an approved IRS extension are rare.
An extension for the 1099-NEC, unlike the other 1099s, is not automatic, the extension Form 8809 must be paper filed with a complete explanation of why the extension is needed, and the circumstances must be dire.
For the rest of the forms in the 1099 Series, Form 8809 can be filed for an automatic extension of 30 days. No explanation is required, the extension form must be completed accurately and filed before the original deadline.
Please note that the 8809 extension does not extend the deadline for distributing recipient copies, it only extends the deadline for filing with the IRS.
Can I File Corrections for 1099 Forms?
Yes, if you find that you file a Form 1099 with inaccurate amounts after the fact, you can correct this by filing a 1099 correction form. This is basically the same form, you will simply check a box on the form indicating that it is a correction and add the updated amounts. This form will then replace the original that you filed incorrectly.
This is also true if you find that you filed a 1099 that was not required. You can file a correction to void the original form. Much like when filing a correction, you will check a box to indicate that you are voiding the original form.
When it comes to filing 1099 corrections, there is a key takeaway. Before filing a correction, the IRS must have accepted the original 1099.