Form 1099 Information – Here’s What You Need to Know!
Hello world, and welcome to tax preparation season! Form 1099 variations, Balance Sheets that won’t balance, and unpaid client bills, oh my! With so many unchecked boxes remaining on your year-end tax preparation list(s), and so little time to check them off, accounting frenzy is afoot. Unsurprisingly, daily tasks, project work to meet or beat upcoming deadlines, and more 2022-year planning tend to be the priorities at this time. If accountants are not Superwomen and Supermen, leveraging their superpowers to churn out incredible accounting work, then how can they manage to get all of these things done in so little time? And, more importantly, with their noses to the grindstone, will the quality and accuracy of their work suffer?
We all know that accountants are busy people in busy professions, and during busy times of the year “busy” is more of an understatement. As a company dedicated to QuickBooks training and performing QuickBooks services for our many happy clients, with a team of Allstar, certified ProAdvisor consultants with strong accounting backgrounds, we know and understand what “busy” truly means for accountants. And we definitely know how “busy” can affect work quality and accuracy. The last thing any business wants are penalties imposed by the IRS for any mistakes or oversights! So it’s important to prepare and execute year-end taxes correctly.
Diving a little deeper into the weeds of year-end taxes, a lot of the technical questions we receive have to do with Form 1099. Form 1099 work can become quite tricky, and a lot of accountants can struggle with choosing the correct Form 1099 variant to file. 1099s are a complex component of the tax preparation and filing process, with 20 Form 1099 variants, and it is essential to report everything correctly to avoid an IRS Tax Audit. Correct reporting will also help to mitigate potential IRS Tax Audits of your employees, which can cause great stress and negatively affect work performance.
Our solution? Read on to learn more about how we can help!
Form 1099: What You Need to Know
As stated before, form 1099 work can become quite tricky, and a lot of accountants can struggle with choosing the correct Form 1099 variant to file. There are 20 variants of form 1099 and choosing the correct variant to use, depending upon your specific tax situation, is not as straightforward as one might hope. Lucky for you, Out of the Box Technology’s team of certified ProAdvisor consultants knows what to do, and they have provided resources you can use to help you prepare for a tax prep review. They have compiled a brief list of important things to know and best practices about form 1099, and it’s many variants, before obtaining a review of your tax filing preparations, following Intuit’s form 1099 video.
Form 1099 Information & Best Practices Video
As a quick recap, a 1099 is a tax document that is used to report income earned by non-employees. The 1099-MISC form is frequently used to report income that doesn’t fall into any of the other categories. However, the most common purpose of 1099s is to report payments made to independent contractors for services rendered to a corporation.
Here are some 1099 recommended practices to help you expedite the creation and distribution of 1099s to all of your independent contractors:
- Have a vendor fill out a W-9 form as soon as they are onboarded.
- Maintain a current list of all of your contact information.
- To keep information organized, use payroll software.
- Know your form deadlines—as of February 1, 1099s are deemed late.
- Prepare 1099 reports every quarter.
- Keep up with the IRS website to be informed about any changes in rules.
The Absolute Best Practice
To ensure you have made all the correct tax filing preparations and that you are on track to have a successful 2022 year, our experts recommend that you have these preparations reviewed. A second pair of eyes will help ensure tax preparation quality and accuracy. Especially a thoroughly-trained second pair of eyes, which our expert, certified ProAdvisor consultants have. Not only can we ensure your tax preparation quality and accuracy, but we can also help you avoid costly IRS Tax Audits and penalties. With tax audits increasing for small businesses, we implore you: get your tax preparations reviewed!
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