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Purpose of Filing Form 1099 MISC Online

IRS Approved & Authorized vendor for e-


filing Form 1099 MISC Online
Facts about online filing of Form 1099-Misc, Miscellaneous Income (2020)

Taxseer provides a quick and easy form 1099 MISC online filing options to the filers through the
online forms that mimic the paper forms. The highly sophisticated Taxseer’s editable online forms
have changed the way the filers have been traditionally filing the paper forms and reduced the
filing time to minutes instead of hours and days. We also provide the e-file of the extension form
8809 if the filer is not ready to file form 1099 MISC before the IRS due date. This blog provides
the critical information that the filer must know before they e-file form 1099-Misc,
Miscellaneous Income.
What should be reported on Form 1099-Misc, Miscellaneous Income?
Filers are expected to file Form 1099-MISC Online for each person to whom they have paid during
the year:

>at least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest;
>at least $600 in:

> Rents;
> Services performed by someone who is not your employee;
> Prizes and awards;
> Other income payments;
> Medical and health care payments;
> Crop insurance proceeds;
> Cash payments for fish (or other aquatic life) you purchase from anyone engaged
> In the trade or business of catching fish;
> Generally, the cash paid from a notional principal contract to an individual,
Partnership, or estate;
> Payments to an attorney; or
> Any fishing boat proceeds,
In addition, 1099-Misc form should be used to report the direct sales of at least $5,000 of consumer
products to a buyer for resale anywhere other than a permanent retail establishment. Form 1099-
MISC must be filed for each person from whom the filers have withheld any federal income tax
(report in box 4) under the backup withholding rules regardless of the amount of the payment.

Trade or Business reporting in Form 1099-Misc

Form 1099-Misc Online filing should only report the payment made in the course of trade or
business if it is operated for gain or profit and no personal payments should be reported. Nonprofit
organizations are considered to be engaged in a trade or business and are subject to these reporting
requirements. Other organizations subject to these reporting requirements include trusts of
qualified pension or profit-sharing plans of employers, certain organizations exempt from tax under
section 501(c) or (d), farmers’ cooperatives that are exempt from tax under section 521, and widely
held fixed investment trusts. Payments by federal, state, or local government agencies also are
reportable.
Exceptions for Form 1099-Misc reporting

Some payments, although they may be taxable to the recipient, do not have to be reported on
Form 1099-MISC. Payments for which a Form 1099-MISC is not required include all of the
following.

> Generally, payments to a corporation (including a limited liability company (LLC) that is
treated as a C or S corporation).
> Payments for merchandise, telegrams, telephone, freight, storage, and similar items.
> Payments of rent to real estate agents or property managers. However, the real estate agent or
property manager must use Form 1099-MISC to report the rent paid over to the property owner.
> Wages paid to employees (report on Form W-2, Wage and Tax Statement).
> Military differential wage payments made to employees while they are on active duty in the
Armed Forces or other uniformed services (report on Form W-2).
> Business travel allowances paid to employees (may be reportable on Form W-2).
> Cost of current life insurance protection (report on Form W-2 or Form 1099-R,
Distributions From Retirement Plans, Insurance Contracts, etc.).
> Payments to a tax-exempt organization including tax-exempt trusts (IRAs, HSAs,
Archer MSAs, Coverdell ESAs, and ABLE (529A) accounts), the United States, a
state, the District of Columbia, a U.S. possession, or a foreign government.
> Payments made to or for homeowners from the HFA Hardest Hit Fund or similar
state program (report on Form 1098-MA).
>Compensation for injuries or sickness by the Department of Justice as a public
safety officer disability or survivor’s benefit, or under a state program that provides
benefits for surviving dependents of a public safety officer who has died as the direct
and proximate result of a personal injury sustained in the line of duty.
> Compensation for wrongful incarceration for any criminal offense for which there
was a conviction under federal or state law.

Due date for 1099-MISC

Online 1099-MISC Form with Box 7 should be filed by Jan 31 and the rest could
be filed before March 31. Any e-Corrections can be done no later than Aug 31.
1099 Extension
If your company needs more time to file your 1099-series forms, then you need to apply for
an extension using Form 8809. There are two types of extensions:
Extension for filing 1099 forms with the IRS
Extension for delivering 1099 forms to recipients
If you plan to file Form 1099-MISC reporting non-employee compensation payments in Box
7, you must request an extension no later than January 31.

Penalty
The penalty varies from $30 to $100 per form ($500,000 maximum per year), depending on
the delays made by the company to issue the form. For deliberate disregard to the
requirements to provide a correct recipient/payee statement, the company may be subjected
to a minimum penalty of $250 per statement with no maximum limit.

About Taxseer
Taxseer is a leading IRS-authorized e-file service provider offering you the best cloud-based
solutions to perform online filings of Forms 1099-Misc, other 1099 series, W-2, ACA
(1095-B & 1095-C), 2290, 8849, 8809 and many more. We provide Wizard-driven e-filing
for guided and error-free submissions and extend the security, intelligence, availability, and
agility of the tax solution on the cloud. SSL-encrypted connections are used for transferring
sensitive information and to provide a very safe environment for clients. As part of our
commitment to making e-filing easy and convenient, we are always available Read More
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