Small Business 1099 help is here! Step by Step Instructions
As a small business consulting firm, we get this issue with our clients every year. We are happy to help you with outsourced bookkeeping, including helping you finish up your 1099 requirement.
CPAs can be engaged to do your 1099s, but it is NOT a given. This process is nothing like filing your federal and state taxes. You can have your outsourced bookkeeper do the work; you can do it yourself; or you can specifically ask your CPA for this service. However, it’s not a simple task to extend the deadline. You must post mark all 1099s by 1/31/2015.
This week, you need to:
- Run a vendor report for every contractor you paid $600.00 or more to in the past year. This includes casual labor, services, untaxed commission payments, etc.
- Every vendor that you paid $600.00 needs to have a w9. (technically, you need them from all of your vendors, but let’s just get this done for now, shall we?).
- The w9 will tell you whether the contractor is required to get a 1099. You only send 1099s to sole proprietors and some partnerships. If the contractor is incorporated, you are not required to send a 1099.
- Keep all of those w9s in your vendor files.
- Order forms 1099 and 1098. These will generally be in one package.
Next week, you need to:
- Reconcile all of your bank statements, so you know all contractor payments are in your small business accounting software. Are you closing every month? Great! Close December, and it’s done.
- Receive all the w9s back. This is no small feat. You can welcome faxes, just get them complete and in the door.
Final week of January, you need to:
- Print and mail all of your 1099s.
- Prepare the 1098 if you’re motivated to finish things a month early, given that the work is done.
About the Author Barb Fisher
Barb is the CEO of Fisher Bookkeeping, an outsourced bookkeeping consultancy that provides small businesses with a full-service financial department. Her favorite aspect of work is to break down the accounting to meaningful bits, so entrepreneurs can make a powerful difference in their own business. She's also a power lifter (squat: 215, DL: 270).