It may seem hard to believe, but now is the time to be thinking about your 1099s. The year will be over soon and if you prepare now for filing 1099s and take the following two steps as soon as possible, then you will save yourself the headache that we all associate with this necessary task.
- Research 1099-MISC Instructions
It is very important to be aware of any alterations in the instructions for filing 1099s published by the IRS. If you don’t do your research, you could end up spending a lot of time preparing your 1099s incorrectly. For example, since 2012 we no longer file 1099-MISC forms for payments made by credit card or other third party payment organizations. Those who saw this change and understood the implications, were able to reduce the amount of forms they filed thus saving themselves time and money.
- Collect Vendor Information
Once you understand the rules, it is important not to procrastinate in gathering the needed information. Often, this is the piece that can gum up the works and lead to penalties. While you don’t know what your final amounts will be, you can take a look now and see who has already surpassed the $600 threshold and make sure that you have their completed W-9s. By starting now, you can track down any missing information and avoid the stress in January.
It all may seem daunting but there is no need to fear filing 1099s. If you get started now, you will be well ahead of the game in January. Also, there is help available. We prepare 1099s for many of our clients. Please let us know if you would like our assistance in preparing your 1099s.