Key Takeaways
- Form 1096 is used when you're submitting paper 1099 forms to the IRS.
- The purpose of Form 1096 is to provide a concise summary of the 1099 forms that are included with the 1096 form.
- Form 1096 is only necessary if you are submitting paper forms, not if you are submitting your forms electronically.
- You should submit one Form 1096 as a cover sheet for each batch of unique 1099 forms you are submitting by mail.
Understanding IRS Form 1096
Tax documentation can be a complex landscape for employers, particularly when processing contractor payments during tax season. One important document is IRS Form 1096—it’s kind of like the cover letter for your 1099 forms when you're mailing in paper versions of the forms to the IRS. It's the required way to summarize the information on the 1099 forms sent to independent contractors, vendors, and other non-employees during the year.
Here’s what you should know about Form 1096 and why it may need to be on your radar as a business owner.
Purpose of Form 1096
Form 1096 provides the IRS with a summary of the paper returns you're filing with the form. If you've made payments to independent contractors or other non-employees that are reportable on forms like 1099-MISC or 1099-NEC, Form 1096 acts as a cover sheet for those forms summarizing the information that is included on the forms.
You should include Form 1096 when you mail physical versions of any of the following types of informational returns:
- Form 1097: Used by organizations to report Bond Tax Credit.
- Form 1098: Reports certain contributions and payments such as annual interests paid on a mortgage, student loan interest paid and tuition payments.
- Form 1099: Used to report income. A number of versions of Form 1099 exist, including 1099-MISC, which reports miscellaneous income, 1099-NEC, which reports self-employment income, and others.
- Form 3921: Reports exercise of employee stock options under a company's employee benefit plan.
- Form 3922: Used to report transfer of shares acquired through an employee stock purchase plan.
- Form 5498: Covers details associated with traditional or Roth IRA information including contributions and required minimum distribution dates and amounts.
- Form W-2G: Reports certain gambling winnings, including lottery, poker, or sweepstakes.
Filing Requirements
It’s important to note that Form 1096 is only required if you have issued certain forms and are submitting paper copies to the IRS. If you file your forms electronically, you do not need to submit Form 1096. But, if you're mailing paper versions of 1099-MISC, 1099-NEC, or others to the IRS, you should attach a 1096 summary as the cover sheet.
TurboTax Tip:
Always include Form 1096 when submitting paper 1099 forms or other specified forms by mail to the IRS. Pay attention to deadlines – usually the end of January or February, depending on the tax forms it's filed with.
Determining when to file Form 1096
Business owners and employers should complete this form, along with the other necessary tax forms, and mail it out to the IRS no later than the end of January or end of February depending on the forms that you are including with Form 1096. See the Form 1096 instructions to verify which due dates apply. Missing the deadline could result in late penalties, but you canfile for an extension if needed.
Information Required for Form 1096
Filling out Form 1096 can be a relatively straightforward process, once you have all the necessary details at hand. Here's what you need:
- Filer's Name and Address: This would be your name or your business name, along with the full mailing address, including city, state, and zip code.
- Contact Person, Telephone number, Email, and Fax: The IRS may need to get in touch with you for further clarifications/confirmation. Therefore, you'll need to provide the name of a contact person, a telephone number, and an email. Although optional, including a fax number may be beneficial.
- Employer Identification Number (EIN) or Social Security Number (SSN): If you operate as a business, you'll typically use your EIN. If you’re filing as an individual and don’t have a separate EIN, use your SSN.
- Total Number of Forms Reported: This is the total count of the forms you are submitting or attaching with Form 1096. You should use a separate 1096 for each type of form you submit.
- Check the Appropriate Box: Form 1096 is used to transmit different types of forms such as 1097, 1098, 1099, etc. Checking the appropriate box ensures the IRS categorizes your submission correctly.
Remember, for business owners, Form 1096 serves as a type of 'checklist' when filing any paper versions of forms in the 1099 series, along with other forms such as 1098, 1042, 3921, 3922. By providing an organized summary of this information, IRS Form 1096 helps ensure that your filings are accurate and complete.
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