What are the reporting requirements with respect to independent contractors?
Business owners, including individuals engaged in any type of trade or business, are required to file Form 1099-MISC, Miscellaneous Income to report payments to independent contractors of $600 or more during the year for services performed for the business by independent contractors. The forms must be filed with the Internal Revenue Service by February 28 of the year following the year in which the payment was made. For example, if an independent contractor performs services on March 15, 1999, the Form 1099-MISC must be filed by February 28, 2000.
Business owners, including individuals engaged in any type of trade or business, are required to file Form 1099-MISC, Miscellaneous Income to report payments to independent contractors of $600 or more during the year for services performed for the business by independent contractors. The forms must be filed with the Internal Revenue Service by February 28 of the year following the year in which the payment was made. For example, if an independent contractor performs services on March 15, 1999, the Form 1099-MISC must be filed by February 28, 2000. It is important when hiring independent contractors to request the contractor’s full name or business name, address, and social security or federal identification number. It is the business owner’s responsibility to file the Form 1099 reporting the amount on miscellaneous compensation and the information noted above. The Internal Revenue Service cross-references amounts reported on the Form 1099 to the contractor’s tax return. The contractor
