It is that time of year….time to issue 1099s to vendors. And it is serious stuff so please don’t ignore issuing 1099s. I know they are a pain to create and submit but 1099s protect your deduction. Under audit, you as the business owner, you would need to show that a 1099 had been issued to a vendor in order to deduct that vendor payment. The responsibility is all on us to create and issue 1099s to secure our tax deductions.
Vendors often call me frantically looking for their 1099s claiming they cannot file their taxes without it. This is simply not true. Vendors are required to file their taxes based on income they earned during the tax year and not on income on 1099s only.
If you have any questions or concerns about who to issue a 1099 to and which boxes to mark on the form itself, please reach out to us or your own accountant or tax advisor. Don’t guess ! A guess can be expensive.
Happy 1099 filing season business owners.