How to File 1099-MISC: Comprehensive Guide for You

How to File 1099-MISC: A Step-by-Step Instruction

Being a business owner includes a range of bureaucratic documents you have to follow up to unless you want the IRS to be cautious about you. While most forms are filed for the processes inside a business, knowing how to file a 1099-MISC helps report on your external (non-employee) payments. So take a look at the 1099-MISC How to Report Guide below.

What Is a 1099-MISC Form?

As a derivation of 1099, a 1099-MISC is meant for filing by an employer whose current calendar year has included payments to non-employees. Such payments have to be in the range of $600 and more, provided for freelancers for their services. Mind that part-time employees aren’t considered independent contractors, so they are not subject to filling out the form. Also, it’s hard to tell how to avoid paying taxes on 1099-MISC forms due to their straightforwardness.

Even though the law doesn’t define any strict payment types, there are some categories that are still considered fillable. Wages, salaries, and bonuses should give you a clear idea of how to file a 1099-MISC with the IRS. Also, rent and awards can be subject to the 1099-MISC consideration if, again, they are over the estimated payment range (see below to learn how to get a 1099-MISC form).

According to the governing law, a freelancer is not obliged to handle or even know how to fill out a 1099-MISC form. With each annual tax-return procedure, your employer/s receives the form to file based on the compensations they have paid to you. Contrastingly, the employer is obliged to send a copy of the form to you so that you have sufficient grounds while filing your Schedule C.
How to Report a 1099-MISC?
Before getting to know how to file a 1099-MISC, you should know a little about the taxation procedures and what comes with it. If you are an employer and hired a freelancer during this calendar year to provide a range of services, you might need to file the form. In case the services provided for you have come to $600 or more from a single contractor, then you need to handle the form and send a copy of it to the contractor.

Meanwhile, a self-employed contractor doesn’t have to bother with how to file a 1099-MISC on Turbotax or any other tax filers. Because it’s solely the employer’s duty, the contractor gets a copy of the form at the end of the year while another copy goes to the IRS. But again, this condition works only if there is an exceedance of the amount paid. Overall, the tax rate for both the employer and contractor amounts to 15.3%.

How to Fill Out 1099-MISC Forms?

Here is what you need to do to handle the form correctly:
#1 Know your information
How to report 1099-MISC forms? Whether you are an employer or a contractor, you need a completed W-9 form to proceed with a 1099-MISC. By collecting the information from W-9 of your contractor, you get their relevant name, address, SSN, TIN, etc. Mind that the IRS highly recommends that you keep all the previous W-9 and 1099 forms for at least a couple of years.
#2 Start filling out
How to get form 1099-MISC copies? Contact the IRS or expect it to send the form to you automatically.
- Type in your business information and the information about a contractor;
- Field 1-3. Designate the payment amount to the contractor;
- Field 4. Add tax withholdings (if applicable). Normally, freelancers are exempt from withholdings; however, some cases may require you to do so. Don’t worry; you will be notified about it by the IRS;
- Field 5-7. Include information about the contractor’s overall income and taxes following it.
How Do I File 1099-MISC Form?
Hopefully, after learning how to handle Form 1099-MISC, how to file taxes won’t be a problem. When you’re done dealing with the form, it’s time to submit it. Interestingly, one copy isn’t enough since you have to file two in order to finish the process.

The first one, copy A, is to be sent to the IRS either electronically (read below how to file a 1099-MISC online) or manually (by mail). The second copy, B, is meant for your contractor who will later use it for filing their Schedule C. Both copies are due by Jan 31st and are followed by penalties should they be overdue.

FAQ

Do you have some questions about how to issue a 1099-MISC? Find the answers here!
customer:
How to issue 1099-MISC forms?
Support:
The process of issuing includes collecting information about your annual payments, getting contact and taxpayer’s information from your contractor, and filling out two copies of the form. While it is of no importance whether the form is submitted online or by mail, you have to send a copy to your contractor for their tax return.
Сustomer:
How to file taxes with a 1099-MISC if I am a contractor?
Support:
You don’t file the form yourself if you are/have been a hired person. The document is completed by your employer, who later sends you a copy of it. Upon your acquisition of the form, you have to use it to complete your Schedule C.
Сustomer:
How to correct a 1099-MISC?
Support:
Of course, you need to review your form for mistakes before sending it to the IRS. However, you can submit the form again by ticking the box ‘Corrected’ at the top of the document and submitting it anew. In this case, you also have to make amends to your corresponding forms, e.g., 1096.
Сustomer:
How to file 1099-MISC for free?
Support:
When handling the form, it can be filed either by yourself, using the IRS forms from the website, or with the help of online services. The latter provides a full range of services that enable you to have a fast and quick filing. All you need to do is supply an agency with online information about your taxpayer’s account, whereas the rest is done by them.

Printable blank Form 1099-MISC (2020)

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