The IRS requires businesses to file information returns to qualified companies and individuals by reporting the money you have paid them for qualifying events during a calendar year (January through December) using IRS Forms 1099 and 1096. 1099s are issued to the company and individual directly and a copy of each is sent along with Form 1096 which totals the amounts paid to all qualifying companies and individuals. The IRS uses these information returns to cross-check the payments you made to the companies/individuals with the income they reported.
Typically, 1099s are issued for payments made to independent contractors - non-employees you paid for services - for $600.00 or more in a given year but can include money you paid in royalties, rents or gross proceeds paid to attorneys and much more. There are also plenty of exceptions, including corporations in general (with some stipulations) and payments made for inventory.
The WorkingPoint 1099 report helps you prepare for filing your 1099s and 1096 by showing you all of the payments you have made to contacts you have selected to be tracked for a 1099. It includes the name of the contact and how much you have paid to them during a calendar year so you can decide who you need to send a 1099 to. We have also excluded any payments made for inventory items for you.
For specific information on who should get an IRS Form 1099 and how to complete and distribute the forms, visit the IRS website.