Important NEW Info on Form 1099s for 2016 Tax Year!

It’s 1099 Time!

It’s that time of year again! As an Allen Street Consulting client, you have the benefit of having 1099 preparation experts at your fingertips! If you need to prepare and file 1099s, it’s easy for you, as long as you follow a few guidelines!

If you’re a client currently receiving bookkeeping services from us, your bookkeeper will be in touch soon to discuss this email and the 1099 process in further detail.

First: what is a Form 1099?

By law, you generally must provide a Form 1099 to any person or business to whom you paid $600 or more in the 2016 calendar year, as well as file it with the IRS. This could mean a graphic designer, contracted workers, an office landscaper – anyone whose services you pay for outside of your regular payroll. Please note, this does not apply for corporations (so you don’t send a 1099 to your phone company for all the money you pay on your phone bill), and this only applies for business to business transactions (if you paid a professional to paint your personal residence, for example, you wouldn’t use a 1099).

***IMPORTANT NOTE!*** Unlike past years, Form 1099s are due to be mailed to vendors/contractors and submitted to the IRS by Tuesday, January 31, 2017 (whereas they were previously due to the IRS by February 28). This means 1099 prep will be happening on a much shorter timeline than it has in past years, and it’s critical for our clients who need 1099s prepared to read this post in full and then stick to the prescribed deadlines.

If you’re not sure whether you need to prepare 1099s or not, just get in touch with us to be sure!

Please prepare my Form 1099s for me!

No problem! Here’s what you need to do to help us help you.

  • Here’s how our process works: you’ll submit your 1099 data to us (details below), and we will prepare them for you. The week of January 23, we will furnish you with a PDF copy of your 1099s to review for any errors. We will then update 1099s as necessary, print, and submit to the IRS by January 31. How easy is that?
  • In order to correctly prepare your 1099s, you’ll be submitting spreadsheets to us with the full name, Employer Identification Number or Social Security Number, current address, amount paid, and type of payment for all of the people for whom we need to prepare a Form 1099. Here’s an example spreadsheet:

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  • To get this information, you need to request a completed Form W9 from your vendors & contractors – to get you started, we’ve attached here a blank Form W9 – this is how you request the full name, EIN/SSN, and address from your contractors. And since Allen Street Consulting is a partnership and will therefore need a 1099 from you if you have or will have paid us more than $600 this year, we’ve attached our W9 here as well!
  • As you gather your completed W9s, we’ve gone the extra mile for you and prepared an easy spreadsheet you can fill out with all of your contractors’ information, just like the one above – just click here and select the file name to download (you’ll need Excel, Google Sheets, or a similar software to prepare).
  • For the preparation of 2016 Form 1099s, Allen Street Consulting will charge just $75 for up to ten (10) Form 1099s prepared, and just $2 for every Form 1099 thereafter.
  • To avoid fees, penalties, and/or migraines, you will need to submit your spreadsheet to us by January 10th, 2017. Folks who submit spreadsheets or data after January 10th will be asked to pay a $50 rush processing charge. This deadline is earlier than in years past, and no extensions will be granted to ensure that our staff has the time to produce, review, and submit your Form 1099s to the IRS by January 31. You may transmit data or corrections to us after the January 10th deadline, but you will be subject to the rush processing charge.

What do I need to do right now?

It’s best to start gathering the above mentioned information from your contractors NOW to avoid having to pay a rush processing fee or being penalized by the IRS. If you haven’t finished paying your contractors for the year, that’s okay! Gather the information for any contractors who have already been paid $600 or more or who you estimate will be by the end of December. Request completed W9s from vendors you know for certain will need a 1099 from you, or who may be close by December 31. Better safe with a W9 on hand than scrambling for a vendor to reply to your email after January 1!

This sounds like a lot!

Form 1099s can sound scary! Luckily, you have experienced and dedicated tax professionals at your fingertips. Don’t worry – we’ll be sending out lots more reminders, emails, and links for submitting your final spreadsheet soon.

As always, please don’t hesitate to get in touch with us if you have any questions or concerns!

Allen Street Consulting
allenstreetconsulting.com
394 Franklin St.
Buffalo, NY 14202
(716) 218-0564

info@allenstreet.net