Critical Steps That You Need to Consider When Generating 1099-MISC Forms.
You need to ensure as the tax season approaches, you needed to have the right information that will help you carry out the right preparation of books of accounts in the right manner. Following the law, if you happen to have contracted independent employees, you are required to generate a Form 1099-MISC. It may seem like a complicated procedure especially if this is the first time that you are hiring and paying the independent contractors, however with the right tools and steps in place, you will find it straightforward. Be sure to have all the necessary details to ensure that you do not make a mistake. You need to have filled the W-9 for each one of them too before you start the procedure that will need to include the social security numbers, name, address and the employer identification numbers. You find that in case one of the contractors does not have a filled W-9 or in case he/she has omitted some information, it is your duty to hold 28% of the pay as accordance to IRS.
Be sure to get the samples then that IRS website will be able to read properly. Include the amount of money that you are paying the contractor under the non-employee compensation. Lastly, you then to fill the contact details of every contractor and ensure that you use the financial software to ensure no human errors.
Just like any other procedure that requires an application of forms, here, you will need to send the forms to their respective places. Thus, you might think that after the filling the forms you are done, but there is still more work for you to do. This is you sending these forms to their respective places. Make sure that you hand your 1099 copy to the contractor before it exceeds the required date which might cost you more money. Thus, you need to ensure that you always keep time to avoid being charged with penalty fees of IRS like it has been mentioned to you in this article. Filling form 1096 will be done with IRS. Without this form, there can be no summarizing of the return sums.
Without having the record for the most crucial filling you did, you will have no evidence to prove you filled. In case you need to review the Copy C in future, then having a record which you will be using. These records are very helpful and useful especially when questions come, and they concern the info on the IRS. The entire process mentioned above is very stressful. You can opt to make the work easy when you get a professional who can do the filling and give the best results.