Critical Steps That You Need to Consider When Generating 1099-MISC Forms.
As tax season approaches, you are required to ensure that the books of accounts are closed and the payment of workers paid. The law requires every manager to ensure that if you happen to contract the independent workers, you need to fill out 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 have the samples of the forms that IRS website will detect and fill them in the right manner. Be sure to fill out the hard copy forms with the federal tax ID numbers that may involve the SSN or EIN, be sure to also include the contractors SSN and EIN in the right manner. Lastly, you then to fill the contact details of every contractor and ensure that you use the financial software to ensure no human errors.
Filling is very important, and that is why you should always be very active when you are doing it of which you can let another person do it on your behalf. Thus, you might think that after the filling the forms you are done, but there is still more work for you to do. You will not need to keep the filling with your because you will not be helping o anything. 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. Use OF IRS form is very crucial and that what needs to be done with 1096. This is the form that is used for summarizing returns totals.
Without having the record for the most crucial filling you did, you will have no evidence to prove you filled. Record Copy C so that you can use it when in need. Thus, for future use, you are required to, in case of any questions, about the IRS information, you can use the records as well. 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.