As the end of the year approaches, we remind trades and businesses of the 1099 filing requirements for payments to vendors or contractors over $600 total during the 2022 calendar year.
We suggest requesting updated Form W9s from your vendors each year to ensure you have the correct information.
Many of you may see an increase in receiving Form 1099-K’s issued to you or your businesses for rental income, a side hustle, or businesses on the web, as that filing threshold dropped to $600 for the 2022 tax year. Please include those forms with your tax information for your return preparation.
If we are processing 1099s on your behalf, we will need the information by January 15, 2023, to process and provide the 1099s to the recipients by the filing deadline, January 31, 2023. As a reminder, rental properties considered a Trade or Business for tax purposes must also issue 1099s to be appropriately considered a Trade or Business eligible for the Qualified Business Income Deduction.
Starting with the 2022 tax year (filing in 2023), any trade or business issuing 10 or more 1099s or W2s must file these forms electronically. Therefore, if you are self-preparing and filing more than 10 1099s, use a reputable electronic method for filing.
As a reminder, substantial penalties can be assessed if 1099s are filed late, incorrectly, or not filed at all.
Please reach out to your tax professional if you have any questions or would like our firm to prepare your 1099s.