2011 Form 1099
Just a reminder that every person engaged in a trade or business, including partnerships and non-profit organizations, must file information returns (Form 1099) each calendar year for payments made for certain types of services. This is an Internal Revenue Code requirement and the penalty for failure to file is $30-$250 for each informational return missed. The recipient needs to receive this information by February 15, 2012.
The following is a list of some common payments required to be reported to the Internal Revenue Service if paid to individuals, partnerships or estates:
- Rents (office space, machine rentals) greater than $600.00
- Amounts paid to non-employees for services totaling $600.00 or more during the year (i.e. fees, commissions, professional, clerical, consulting, etc.)
- Amounts paid to medical or health care providers greater than $600; both incorporated or unincorporated.
- Prizes and awards greater than $600.00
- Payment of interest or dividends (at least $10.00 or more) to individuals
- Distributions made from profit sharing plans to plan participants
- Attorneys’ fees paid in the course of your trade or business for legal services incurred during the year for all attorneys; both incorporated or unincorporated.
Except for attorneys’ fees and health care providers, it is not necessary to include payments to corporations. If you are not sure of a payee’s entity type, you should have them complete a Form W-9 and return it to you.