It seems like we just rang in the new year, but, unbelievably, the first tax filing deadline is already upon us. By January 31st, businesses, nonprofits, and others who make certain payments must report them on IRS Form 1099. In general, Form 1099 must be completed and filed for each person or unincorporated business to whom $600 or more was paid during the year for rents, nonemployee income payments, and other payments defined by the IRS.
Here are four tips to meet the Form 1099 Tax Filing Deadline:
- Payments are reported on Form 1099-NEC (i.e., nonemployee compensation). The payor must report the name, tax ID, and amount paid for each applicable entity to whom $600 or more was paid during the year. For more information about Form 1099-NEC, including instructions, go to https://www.irs.gov/forms-pubs/about-form-1099-misc.
- The due date for filing Form 1099-NEC is January 31st for the calendar year ending December 31st. There is no extended filing deadline for submitting this form.
- Reporting on Form 1099-NEC does not apply to personal payments. The form is only used for payments made as part of a business, nonprofit, trusts of qualified pension or profit-sharing plans of employers. Like many IRS rules, there is an exception – payments to attorneys for legal fees.
- Some payments do not have to be reported on Form 1099-NEC, although they may be taxable to the recipient. For example, payments to a C or S corporation, payments of rent to real estate agents or property managers, and business travel allowances paid to employees are generally not reportable on a Form 1099.
If you make payments as part of your business, nonprofit, trusts of qualified pension or profit-sharing plans of employers, your first tax filing deadline for 2022 could be coming up. Use these four tips to see if payments that you made in 2021 need to be reported to the IRS by January 31st.
Need more details? The IRS has them for you at https://www.irs.gov/businesses/small-businesses-self-employed/am-i-required-to-file-a-form-1099-or-other-information-return.