Last Minute Tips for 1099-MISC Filing

This past September, we brought to your attention new filing requirements for certain types of Form 1099.  The January 31st deadline is upon us, and it’s important that you file all of your 1099-MISC forms accurately the first time.  Here, we offer 3 simple, last minute tips for making that process easier:

1. First things first

Only Forms 1099-MISC on which you’re reporting nonemployee compensation (Box 7) need to be filed with IRS by January 31.  For everything else, you must provide the forms to payees by January 31, but you have until Feb. 28 (paper filing) or March 31 (electronic filing) to file that information with the IRS.  

Tackle one thing at a time, focusing on that “Box 7 deadline” first.  The Feb. 28/March 31 filing deadlines apply to all other information returns, such as Form 109-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.

2. Don’t freak out if you get Box 7 wrong (by a little bit)

Take accuracy seriously, but if you run into a problem or don’t have the exact final number, press on.  You can take advantage of a new safe harbor for de minimis errors that protects you from being liable for penalties if the error for any single amount is $100 or less or $25 or less if the errors involve backup withholding.  In addition, you won’t have to send corrected forms to payees, unless they ask for them (but if they do, you’ll be liable for penalties -- it’s still a good bet).

3.  Confirm Taxpayer ID Numbers

If you haven't done so already, ensure that you have independent contractors' correct Taxpayer Identification Numbers (TINs) by registering with the IRS for its online TIN matching program. There are two options:

• Interactive TIN Matching: You may match up to 25 payee/TIN and name combinations in real-time.
• Bulk TIN Matching: You may submit a file with up to 100,000 TIN and name combinations and receive a response to your secure mailbox within 24 hours.

See the IRS' e-services web page for more information.

If all else fails, you can request an extension of time to file.  The IRS allows for an automatic 30-day extension of time to file your 1099-MISC forms by filing Form 8809. Remember to check the appropriate box on Line 6: 1099-MISC NEC reporting only. Additional extensions are available, but you'll need a good reason for requesting them. Form 8809 may be filed on paper, online or electronically through the IRS' FIRE system.  Do this only if totally necessary, however.  Tax season deadlines have a way of piling up on one another.  We always recommend filing on-time when possible.