Overview of 1099 Forms for LLC Partnerships
An LLC partnership must issue a 1099 form if it paid an independent contractor or vendor at least $600 during the tax year. The partnership reports each partner’s share of income, deductions, and credits on a Schedule K-1.
1099-NEC Requirements for LLC Partnerships
If your LLC partnership makes payments over $600 to individuals, partnerships, LLPs, LPs, or sole proprietors, 1099 reporting is generally required. Most payments to C and S corporations do not require a 1099.
Determining 1099-MISC Need for LLCs
Whether an LLC gets a 1099-MISC form depends on its classification. A single-member LLC treated like a sole proprietorship will not get a 1099 from itself. But an LLC classified as a partnership or corporation will receive a 1099-MISC if it meets the criteria.
Issuing 1099-NEC as an LLC Partnership
If you are an LLC partnership and hire contractors or independent workers who earn over $600 per year, you must send them a 1099-NEC form at year-end.
Deadline and Penalties for 1099 Reporting
- Deadline is February 15 for forms reporting gross proceeds of at least $600 paid to attorneys or substitute dividends and tax-exempt interest payments reportable by brokers.
- There are penalties for each information return that is filed late or not sent. The charges vary depending on the lateness of the filing and whether the business intentionally ignored its responsibility.
1099 Filing Guidelines for LLC Partnerships
If your company is not sure that an independent contractor should get a 1099, it is recommended to make the blunder and file 1099 for the tax year. In some cases, the IRS may grant an extended due date for filing 1099-NEC and 1099-MISC forms.