Neither the taxpayers wish to receive the 1099 forms, nor do the businesses enjoy sending them. But those who love interfering with the forms must be the IRS. The agency wants the qualified taxpayers to submit the forms on time to match the data against the returns. Opt for a service provider for the flawless tax management West Palm Beach or wherever you are located.
So, here are a couple of things that are shared for the taxpayers about the 1099 forms per rules of the IRS—
Give it out
Mainly the businesses issue the forms to the taxable bodies like those who are tentatively earning around $600 annually and more. Depending on the guidebooks and the several rules and the exceptions, it is decided that how much be business will be taxable. Even if you earn $10-12 as interest, the banks will give you the 1099 form for every account that you have with them.
To make it simpler all the way, the next generation offices are putting more efforts in incorporating the software and other developers for the flawless tax submission.
Be on time
Taxpayers have to be specific about maintaining the time. Normally, by Jan 31st the forms are sent by the business for the previous calendar year. But it will be your foolishness to consider that you are “off the hook” if somehow you didn’t receive the form by February or by the end of March.
Being a taxpayer you must be on time whether it’s your business or partnership business so that the IRS never get the chance to condemn you with severe penalties if found guilty.
Sometimes the forms are received by the end of April when the tax is already filed. Even the companies are also penalized for issuing the forms late. Hence make sure you are sure about the forms to stay in the safer zone.
Know your form
Varieties of 1099 forms are there. Here, a few are mentioned for your knowledge.
- 1099-G is for the unemployment benefits and the local tax returns
- 1099-INT is for the interests
- 1099-DIV- for the dividends
- 1099-B for the Broker Transactions
- 1099-R- for the retirement accounts and pensioners
- 1099-S-for the real estate transaction
- 1099-MISC- for the miscellaneous
Along with these things, make sure the tax filling has the right address given and all the data served are true to your knowledge. Hire a tax consultant if you need to more about the tax filing and other things.
Know and pick your form in details—
The basic tax form that you must file is the 1040 form but you have to add more forms related to your income and any deductions. There are three kinds of tax forms:
- 1040- This form is a basic income tax form for incomes greater than $50,000 and contains six schedules. These schedules list the itemized deductions, taxable interest, profit or loss from a business, capital gains and losses, additional income and losses and earned income tax credit.
- 1040A- When your income is less than $50,000 and you do not itemized deductions, you can use form 1040A
- 1040EZ- When your earned interest is less than $400, you are below 65 years of age, you are not blind, your taxable income is less than $50,000 and you have no dependents, you use form 1040EZ.
Author’s Bio: Luke Durante is a professional tax preparer, in this business for the past couple of years. His passion for his profession has driven him to pen articles on related topics.
