Every year my client’s swear they will be prepared next year to file 1099’s without the mad scramble. Do you make that commitment too?
The fact of the matter is, as a business owner it is your responsibility to get the facts prior to paying the vendor so that the correct tax forms can be completed properly and in a timely fashion. So this year put a process in place to make filing your 1099’s stress free.
Each time your business works with a new vendor, request a Internal Revenue Service Form W-9 be completed. If you are working with self employed subcontractors get this documentation BEFORE you send them their check. (W-9 Instructions & W-9 Online Form).
Once you receive the completed W-9, enter the information into your accounts payable software for easy year end electronic reports. Many softwares will complete the 1099’s for you or at the very least export into a file format for easy data entry into the forms.
I like to use an online service efilemyforms.com for my clients. I can create a secure account and maintain vendor information from year to year eliminating extra data entry. They create a submission and summary report for the filer to print out, physically mail the recipient their copy and electronically submit the necessary documents to the IRS for a very low per transaction cost.
If you have a tip on how to make 1099’s easier, let us know by posting a comment below.