BIZ OWNERS: The deadline for you to send out Form 1099s is February 1, 2021.
The IRS requires that a Form 1099 be sent to each independent contractor who provided at least $600 worth of services to your business in 2020. This deadline is to ensure that the contractor receives the 1099 in time to include it in her/his/their own tax return to record income generated. The contractor receives one copy AND the IRS receives a copy.
This is important AND there are exceptions (electronic payments) and rules (based on the contractor’s company formation type) so if this is making you nervous, PLEASE take a deep breath and refer to the IRS website and/or contact your accountant for full details. Really, please rely on the experts!
There are hundreds of things to remember when running a business so I urge you to enlist the advice of experts: tax and legal professionals to ensure that you are compliant with state and federal requirements and making sound decisions AND specialists like me who have hands on experience as a small business owner. The investment in expertise is worth it.
My goal is to make things easier for innovators and entrepreneurs because I have BEEN THERE. In addition to offering personalized guidance on how to launch products and services and run successful Kickstarter campaigns, I guide people who have ideas with first and next steps. Sometimes it is forming a company, retaining an IP attorney, creating a prototype and other times, it is an individual who wants to monetize a hobby who needs a basic plan for success.
If you need help, please be in touch with me. I offer various solutions including an introductory “Power Hour” for brainstorming and “tune ups” to make sure that you and your project are on track. Contact me to schedule your complimentary consultation: firstname.lastname@example.org
PS: While I am not a CPA or attorney, I retain both to help me run my businesses so I know the importance of how and when to engage these specialists!