How to Get Accurate Information to Prepare Your 1099s

Remember that accuracy is crucial when filling out 1099 forms, as errors can lead to penalties. Be sure your system is set up to track payments to subcontractors throughout the year. Ours is – we make it E-Z! Trying to gather these amounts at the last minute can be a daunting task!

Right after the year has ended, be sure you’ve reconciled the checkbook to prove your records are accurate, and then use those totals to prepare your 1099s.

To fill out 1099 forms accurately and meet the IRS deadlines, you’ll need the following information:

  • Recipient Information:
    • Full name or business name
    • Address (including street, city, state, and ZIP code)
    • Taxpayer Identification Number (TIN) or Social Security Number (SSN)
    • Business entity type (individual, sole proprietor, partnership, corporation, etc.)
  • Payer Information:
    • Your full name or business name
    • Your address (including street, city, state, and ZIP code)
    • Your TIN or EIN (Employer Identification Number)
  • Payment Details:
    • Total amount paid to the recipient during the tax year. This includes all forms of compensation, such as nonemployee compensation, rent, interest, dividends, or any other reportable payments.
    • If applicable, indicate whether backup withholding is required.
  • Form Type:
    • Specify the type of 1099 form you are filing. Common ones include 1099-MISC, 1099-NEC, 1099-INT, 1099-DIV, and others, depending on the type of income being reported.
  • Provision Deadline:
    • Most 1099 forms must be provided to recipients by January 31st of the following tax year. The 1099-B and 1099-S forms must be provided by February 15th. If either deadline falls on a weekend or holiday, the deadline is the next business day.
  • IRS Filing Deadline:
    • Paper filing of 1099 forms with the IRS is due by February 28th (or the next business day if it falls on a weekend or holiday). If you file electronically, the deadline is March 31st.
  • Electronic Filing:
    • If you have more than 250 forms to file, the IRS requires electronic filing. However, electronic filing is also an efficient option for smaller numbers of forms.

After you complete the forms, provide copies to the recipients and submit the required copies to the IRS before the specified deadlines. It’s important to keep copies of all 1099 forms and related documentation for your records, as well as maintain a record of the dates when you provided the forms to recipients and filed them with the IRS.