DKSS CPA and Advisors

Important 1099 Updates for 2018 Reporting

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Date(s) - 01/01/2019 - 01/31/2019
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IMPORTANT 1099 INFORMATION FOR THE YEAR OF 2018

MichBusiness Champion DKSS CPAs + Advisors wants to bring to your attention a few very important changes to the federal and state filing requirements for Form 1099s. These changes are especially important Form(s) 1099-MISC reporting dollar amounts in box 7 (non-employee compensation).

In prior years, the Internal Revenue Service allowed us to file an automatic 30-day extension for Forms 1099-MISC. An automatic extension is no longer able to be filed for Form 1099-MISC reporting dollar amounts in box 7 unless you meet one of the five possible exceptions.
1) Business suffered a catastrophic event in a Federally Declared Disaster Area causing business operations to stop or records to be unavailable
2) Fire, casualty, or natural disaster affected business operations
3) Death, serious illness, or unavoidable absence of the person responsible for filing information returns
4) Information returns are being filed in the 1st year of operations for the business 5) Data on a third-party payee (1042-S/ Schedule K-1) statement was not received timely. FAILURE TO GATHER THE DATA TIMELY FOR INFORMATION RETURNS IS NOT A VALID EXCEPTION!

As a reminder, Form 1099-MISC is required to be issued to any unincorporated entity or person to whom you paid $600 or more throughout the course of the year. Examples would include payments for:

  • Rents
  • Services performed by any unincorporated entity or person
  • Payments to attorneys (regardless of whether they are incorporated or not)

The link below provides more detailed information regarding payments required to be reported on Form 1099-MISC.

https://www.irs.gov/pub/irs-pdf/i1099msc_18.pdf

Each recipient must receive a copy of their Form 1099-MISC and copies of the 1099-MISC must be filed with the Internal Revenue Service & Michigan Department of Treasury NO LATER THAN JANUARY 31, 2019.

For your convenience, the following link can be used to access a fillable Form W-9. You should require each unincorporated entity or person to complete a Form W-9 before paying them. Completion of Form W-9 ensures that you have complete information to assist in the preparation of any Form 1099.

https://www.irs.gov/pub/irs-pdf/fw9.pdf

If you have any questions, please contact our office at 248.649.3400.

Derderian, Kann, Seyferth & Salucci, P.C.