Overview of 1099 Requirements
Businesses need to issue a 1099 form to anyone (other than a corporation) who received $600 or more in non-employment income during the tax year. The requirements vary based on the type of entity and form used.
Changes in Electronic Filing Regulations
In 2023, the IRS announced that starting in 2024, businesses must file most tax return information electronically, including 1099s. The threshold for electronic filing has been reduced to 10 returns, encompassing various forms like W-2s and 1099s.
Form 1099 Guidelines and Best Practices
For efficient compliance with tax laws, businesses should ensure timely filing of 1099 forms by the end of January for the previous calendar year. Various entities and vendors may need different types of 1099 forms, such as the 1099-NEC or 1099-MISC.
Common Types of 1099 Forms
There are several types of 1099 forms, such as 1099-G, 1099-K, 1099-R, and 1099-Div, used to report different sources of income like state tax refunds or payments from third-party networks.
Form 1099-B and Capital Gains Reporting
Form 1099-B is specifically for reporting proceeds from sales of capital assets like stocks and bonds. Recipients use this information to calculate capital gains or losses for tax purposes.
1099 Automation and e-Filing Tool
Baker Tilly Digital offers an automation tool embedded within Sage Intacct to simplify and automate the 1099 filing process. Features include vendor review and bulk editing capabilities to streamline the preparation of 1099 forms.