The 1099-MISC form is used to report payments made to independent contractors for jobs or work. Businesses must file a 1099-MISC for any contractor paid $600 or more in a tax year. The deadline to file is January 31st for forms sent to recipients and April 1st if filing electronically with the IRS. Penalties may be assessed for failing to file or filing late, ranging from $30 to $250 per incorrect information. The document provides guidance on the filing process and selecting an e-filing service provider to submit the 1099-MISC form electronically.

1. IRS Form 1099-MISC

The 1099-MISC is used to report those payments that
have been made towards jobs or to workers or
independent contractors for the jobs undertaken by them.

2. Who Needs To File A 1099-MISC?

Broker and/or royalties expenditures with respect to
dividends/tax-exempt interests in excess of $10

Attorney expenses paid

Sales of minimum $5,000 of FMCGs to a buyer for
resale anywhere but a retail concern

Every contractor paid minimum $600 during the tax
year is to be reported individually.

3. Who Are Out Of Form 1099-MISC?

If you are employed by a firm or a registered
corporation, then you are not supposed to file the
Form 1099-MISC.

Entities or individuals paying for
scholarship/fellowship support (student should file
return).

4. When is Form 1099-MISC To Be Filed?

January 31st– 1099-MISC Form must be sent to the
recipient

February 28th – The Form 1099-MISC is to be filed
with the IRS physically via paper

April 1st – The Form 1099-MISC is to be filed
electronically with the IRS.

5. Process For Filing Form 1099-MISC?
The information on the Form 1099-MISC is to be
completed adhering to the detailed instructions
supplied by the IRS. The following 4 copies are to
be crated and distributed:

Copy A to be submitted to the IRS

Copy B and 2 to be submitted to the contractor for
his/her IT returns

Copy 1 to be given to the tax department of the
state, i.e., if it is applicable

Copy C is to be reserved for the employer’s
archives

6. Process For E-Filing Form 1099-MISC?

The e-filing of the 1099-MISC can be done online on the
IRS website or the individual can download the e-Smart
Form of the 1099-MISC on his computer and upload the
data and information on the IRS website.

Additionally, the process of e-filing does away with the
copy A of 1099-MISC. However, the additional still need
to be given and distributed to the contractors.

Also, e-filing does away with the necessity to file Form
1096 with the IRS.

7. How To Select Correct E-Service
Provider For Filing Form 1099-MISC?

Should be approved by the IRS (will have the IRS
logo on their website)

Must be secure and safe to trust with important
info(check the site’s security certificate)

Have ample client assistance service – phone,
email, etc.

Should be affordable, reasonable and cost
effective.

8. Penalties For Not Filing The Form 1099-
MISC

$30 per info filed correctly within 30 days
(maximum penalty $250,000/year limited to
$75,000 for small industries).

$60 per info filed correctly between 30 days (March
28th)and 1st August (maximum penalty
$500,000/year limited to $200,000 for small
industries).
Continued...

9. Penalties For Not Filing The Form 1099-
MISC

$100 per info filed correctly after 1st August
(maximum penalty of $1,500,000/year limited to
$500,000 for small industries).

$250 penalty for deliberate failure to file.

10. About Us

1099Fire focuses solely on the information
reporting industry.

We develop and maintain software for year-end
information compliance of 1042-S, 1097, 1098,
1099 software, 3921, 3922, 5498, 8027, 8955-SSA,
W-2G,
and W-2/W-3 (with corrections).

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1099-MISC.
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