With year-end fast approaching, now is the time to ensure the information you have regarding your vendors is up to date and ready for 1099 reporting. For any payments of $600 or greater that you have made as part of your trade or business, you will need to ensure that a 1099-MISC is prepared and sent to those respective vendors by February 1, 2016. This includes payments for rent, legal services or nonemployee compensation. Nonemployee compensation is payment made to someone who is not your employee for services in the course of your operations. Some examples of these payments include professional services for attorneys, accountants, consultants, architects, graphic designers, contractors, engineers, etc.
The most efficient way to obtain all the information you will need to issue 1099-MISC forms is to have a completed federal W-9 form on file for all new vendors. It is recommended that you keep the completed W-9 forms maintained in your vendor files.
If you do not already have completed and updated W-9 forms for any vendors that you have paid in calendar year 2015 as described above, now is the time to ask the vendor to complete and send you the W-9 form by the end of the year. The IRS provides a blank W-9 form on its website; you can send this form directly to your vendors to complete.
Should you have any questions, comments or concerns, please contact us and we will assist you.