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This afternoon I’m sitting down and getting in the 1099s that came in this past week included with our TurboTax return. My husband’s W2 came in last month along with our 1099-INTs from our banks. I entered those along with our information on interest paid on our current mortgage and our student loan.
Now all we have left are a few 1099-MISCs that I’m hoping to receive this week.
What are 1099-MISC?
If you’ve only received w-2s for your wages, then you may not be familiar with 1099-MISC. These forms document income received from various sources, such as:
- contract work
- fees and commissions
- rental income
Since I’m self-employed and do a lot of contract work, I receive quite a few of these come tax time. When entering the data into the program, I make sure that all the data is correct, especially box 7 which states my compensation received.
I’m still missing 2 more; hopefully they’ll come in tomorrow, so I can go ahead and send it all in. We could sure use a refund to help build up our car replacement fund and pay down the student loan just a bit.
On the other side of the table, if you’re self-employed and hired contractors the previous year, you may have to create and mail out 1099s if you paid them $600 or more over the course of the year. Looking at last year’s expenses I don’t have to create any 1099s, but I may have to create some for freelance writers that do work for me this upcoming year.
You can do it yourself as the IRS has all the instructions available:
- Request a W9 from your contract worker
- Use your business’ EIN (Employer Identification Number) on the 1099 (If you don’t have one you can use your Social Security Number.)
- Complete the 1099 with the information received from the contractor’s W9 and your business records
- Send Copy B and Copy 2 to the contractor no later than January 31st
- Send the IRS Copy A along with Form 1096 (Annual Summary and Transmittal ofU.S. Information Returns) by February 28th
- Copy C is for your own records
There are some 3rd party sites that can handle the paperwork and filing, like Intuit. Seeing as I use and love TurboTax and Quicken, I’d likely go with them for creating the needed 1099s and filing them properly.
Thoughts on 1099s and Freelance Income
How many of you have 1099s from your freelance work to include with your tax return? How many of you had to create 1099s?
Did you sign up for direct deposit if you’re expecting a tax return? If you’re looking for more tax tips, please check out my post about 1099s and tax returns on TurboTax. I have a list of the different types of 1099s you can expect, including interest income and proceeds from real estate transactions.