Form 1099 helps streamline a business’s tax filing workload by helping gather crucial information in an organized manner.
How to Fill Out 1099 Forms
Figuring out how to fill out form 1099 can be confusing. As a business owner, it is a necessary and important step in your tax filing, so here are some quick and easy steps to follow.
Step 1: For each 1099 you fill out, you need to prepare five copies:
- One for the IRS
- One for your State Tax Department
- Two for the 1099 recipient (freelancer or independent contractor)
- One to keep in your own records
Step 2: In the box at the top left of the 1099 form, fill out the information that pertains to your business (business name, address, telephone number). Under that, record your TIN and the recipient’s TIN (this can be taken from the W-9 form businesses are encouraged to collect before issuing any work or payments to independent contractors).
Step 3: Skip the “account number” and “FATCA filing requirement” boxes unless your filing meets the criteria of the exceptions, found on page 5 of this document.
Step 4: Fill in those boxes:
- Box 1 – Report all money paid as rent, except rent paid to a corporation
- Box 2 – Enter money paid as royalties on intellectual property or oil, mineral, or gas properties
- Box 3 – Here is where you will report all money paid directly to independent contractors for their work. This box includes money paid as prizes, research study incentives, punitive damages, etc.
- Box 4 – Leave blank
- Box 5 – This is only for fishing boat proceeds
- Box 6 – If applicable, report payment of any medical or healthcare expenses
- Box 7 – Check the box of it is true, leave blank if it is not
- Boxes 15-17 – These apply only to businesses participating in the Combined Federal/State Filing Program, which are not required to complete these boxes
For IRS instructions for filing forms 1099-NEC and 1099-MISC, click here.
1099 Deadlines
The deadline for filing 1099 forms of any kind is January 31, following the end of whatever tax year you are working on. However, for 2020 taxes, the filing deadline is February 1, as January 31 falls on a Sunday next year.
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