Colorado Business CPA, LLC
January 3, 2017
Forms 1099-Misc are due to the IRS by January 31st 2017, which is one month earlier than in the previous years.
Business Owners and Landlords who have paid more than $600 in services (including materials to independent subcontractors, and professionals) need to fill out and issue forms 1099- Misc (box 7) by the new deadline, January 31st 2017.
If you paid for services to an attorney, you need to issue form 1099-Misc (payments made to an attorney) even if you paid less than $600 or if their business is a C or S-corporation. You don't have to issue forms to C or S-corporations in general (attorneys being the only exception), but we still recommend to do so.
Penalties for not filing 1099s on time can result in increased audit risk as well as receiving a penalty ranging from $30-$100 per form if filed late. Also, if you get audited, it is very likely that IRS will disallow a tax deduction for the services paid to subcontractors without issuing 1099s forms to them.
To ensure you have protected yourself, we strongly recommend to collect forms W-9 from your subcontractors with their entity classification, EIN (or Social Security Number), Name and the business address, even before you first pay them $600 and keep this information on file for future reference. You need to keep track of the exact amounts paid to them as well.
If you would like us to file your forms 1099-Misc for you, please present us with the following information:
Your individuals W-9 form, SSN or EIN, name, address and the amount paid in 2016. We can file these forms electronically with the IRS.
Please contact our office by January 17th to issue 1099s forms for your subcontractors at
1-800-5040-272 (CPA) or email information to Tracy Le at Tracy.Le@ColoradoBusinessCPA.com
We wish you a very successful and productive new year!
Colorado Business CPA Team