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Do you operate a trade or business? If the answer is yes, you may want to learn about your potential 1099-MISC filing requirements. Watch this video to find out more about the requirements for issuing a 1099-MISC.
Video transcript:
Hi, I'm Arye from TurboTax with some helpful information about when to issue a 1099-MISC tax form. Do you operate a trade or business and are wondering whether you need to issue a 1099-MISC?
There are a variety of transactions that would require you to issue a 1099-MISC, but there are some more common than others.
- If you pay more than $600 in exchange for services, such as payments to an independent contractor or payments to a lawyer or law firm, then you would typically need to issue a 1099-MISC.
- You'll also need to issue a 1099-MISC if you pay $10 or more in royalties or issue prizes and awards of $600 or more.
- If you ever need to pay a lawsuit settlement other than those to compensate an individual for physical injuries or medical expenses, that’s a 1099-MISC as well.
Always remember that your payment amounts are cumulative and not on a per-payment basis. For example, if you paid a plumber to fix your sink at your office for $200 and then your shower for $500 in the same year, you would need to issue a 1099-MISC as you've paid more than $600 to them in the year.
You'll need to file the 1099 with the IRS by the end of February, although you'll have until March 31st if you file it electronically.
For more information about this and other tax tips, visit TurboTax.com.
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