Question

Understanding 1099

Forum|Forum|3 years ago
January 16, 2023
1 reply
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I own a small landscaping business. Currently as a sole proprietor. I do all residential work but as I do commercial, it seems there are some new things. I'm not referring to MY business hiring a contractor/worker that exceeds $600. I'm referring to a business hiring me, my landscaping business. In my mind, I'd just issue them a receipt- much like my residential customers. I figured if my residential customers had tax situations to write off my work, they'd use my receipt.

But it seems not the case for commercial. If I did 1 job for over $600, I would provide a receipt, but would the business issue me a 1099? In an extreme example, if this same business paid over $600 for a pizza (a lot of pizza..) would that pizza place get a 1099? It seems excessive. Also, its for the year, so individual mowings of $100 don't count each.. but its the yearly total? Thanks

VolvoGirl

Employee

Don't worry about if someone needs to send you a 1099NEC. You keep your own good records and report all your income even if you don't get the 1099NEC. Even if you get a 1099 you can just enter your income as Other Self Employment income or Cash or General. I wouldn't even enter the actual 1099.

They need to give a 1099NEC to anyone they paid $600 or more to for the year. But not to corporations or for merchandise.

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Forms-and-Associated-Taxes-for-Independent-Contractors