In Deep Do-do

Jason Whipple

This is the first year I've ever had to send out 1099's. I thought I had till Feb. 28 to send them out. Finding out today that it should have gone out by the end of last month and we have till the 28th to file with the Feds

So what to do now? I have three subs and a total of 6k paid to them. Do I eat it and pay the taxes? Can I send them out late? What if some of these subs already completed there taxes for this year? Oh st! I'm also waiting for a 1099 from another contractor I worked for last summer for about 12K.

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Jason E Whipple, General Manager
Historic House Restoration, Cincinnati, Ohio
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Celtic

Send them out.
Late is better than never.
They can always file an amended return.

What are you planning for the 1099 you are waiting on?

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Jason Whipple

I guess I'll have to contact him to see what the hold up is. The guy is a millionaire real estate tycoon, construction is a side gig for him. He may not even care about it. I'm still entitled to a 1099 as an LLC from what I understood, maybe not.

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Jason E Whipple, General Manager
Historic House Restoration, Cincinnati, Ohio
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thom

send them out

the subs will have paid the proper taxes anyway (assuming they don't cheat) so it's no big deal. You shouldn't even be thinking about paying their taxes for them.

For building contractors 1099's aren't that big of a deal. Assuming they really are subs, they have materials, labor, and overhead that will come out of that.

It's a bigger issue for other types of contractors, like real estate agents. Their 1099's generally represent real taxable income.

wizendwizard

JW,
All tax forms must be mailed by midnight on 01/31. Send em out they can do amendments. It may cost you a penalty but thats better than eating it.

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Floordude

Exactly! You don't send 1099's into the IRS like W-2's, when you file. If they are running legit, they should even need the 1099.

I go by my deposits, and paper trail. My 1099's never add to what I deposit.

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Jason Whipple

We're workin on it, should have them out by Tuesday. Wonder what the fine is? Anyone know or have actually had the fine impossed?

We're downloading our turbo tax right now on one computer and the other is playing the blues; "Mean ol world" by little Walter to be exact. How fitting

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Jason E Whipple, General Manager
Historic House Restoration, Cincinnati, Ohio
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Tom F.

LLCs, Incs, etc. do not require 1099s.

wizendwizard

I've never heard of this one.

JW, fine amount is probably dependant on amounts and if they are reported as not recieved.

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"If you start the grout process over, you too could use sparkly grout!"
There is no such thing as an illegal immigrant, they are either illegal or immigrants.
I'm Retired, or a student, don't really know anymore.

Tin Cup

Jason,

if your business is incorporated you don't need a 1099 from the contractor you did work for.

send the ones out you owe, i've been way late many times. just call the contractors you owe them to, make sure they know they are coming and how much the total is.

doubtfull many business have already filed their returns.

Just filed mine though, personal, one corporation and an LLC. First time ever I've had mine done this early.

Wanna know the trick to getting it all done this quick by a CPA ?

Tin Cup

Jason Whipple

We're LLC not corp. We file like a sole proprietor basically.

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Jason E Whipple, General Manager
Historic House Restoration, Cincinnati, Ohio
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ultimatetouch

I just had to remind my egg head accountant about them. He never said anything, always trying to do as little as possible and charge me as much as they can . I am getting the list of subs to him tomorrow even though he has my quickbooks and cant print them himself.

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Ultimatetouch
Illinois Remodeling Company, Kitchen Remodeling Chicago, Room Additions Illinois

Jason Whipple

Makes my $100 Turbo tax sound even better now. At least if there's a screw up it's my fault and don't have to pay someone else $600 to screw it up in my place

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Jason E Whipple, General Manager
Historic House Restoration, Cincinnati, Ohio
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BTD

LLC's do get them not corps though. The basic thought behind it is that it is a big deal if you have subs that dont like you, the envelope better be postmarked on 1/31. If you are on good terms it isnt as big of a deal but I would do it as a CYA measure.

Tin Cup

Jason,

I've read some intelligent posts by you over the last few months that i've been reading this site, but, if you are saying you are doing your own tax preparation out of a box......we gotta talk.

I have a business degree, and although i do my own "bookkeeping" on quickbooks, I've never considered doing my own tax prep since i've been a grownup with kids, home, investments and a business. No way you can consider everything as well as a good CPA who's trained and updated on all issues you need to consider. 8 years now, it's the only bill I don't mind paying.

Ever seen the commercial where the wife asks her hubby to "ask the box".

plenty of guys on this site seem quick to criticise guys who perform trades outside of their training, i'll bet several of them are too cheap and do their own tax prep. Watch who this statement fishes out !


The contractors who will bag on CPA's are the ones who haven't found a good one yet.

Don't ask the box ! take it back and put the $100 towards the CPA.

Good Luck,

Tin Cup

AtlanticWBConst

...Send 'em out...late or not...and don't worry about it....

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- Build Well -

DavidC

Jason,

The 1099's are an information only form, meaning you didn't withold any monies. The IRS will have no idea when you sent them if you report to them on time. As someone else stated, the only danger is a pissed off sub that would blow you in. Send them out ASAP and don't worry.

I gotta agree about the accountant too. I get our payroll handled for about $30/week (2 employees) and taxes done for about $400 for the LLC and my personal taxes. Saves me a lot of time do be more productive earning the money to worry about the taxes.

Good Luck
Dave

Jason Whipple

Thank guys,

We're sending them out in tomorrows mail since the P/O is closed today. I have one sub that turned out to be a nut job so he might cause me a problem, we'll see.

I've been using Turbo tax for about 3 years now. I've had a DBA/sole proprietor business over those years for side work and fill in work between jobs. You'd be suprised how well it works. It walks you through eveything step by step, keeps track of previous years losses and tool deprieciasions. It only lets you deduct so much, then it advises you to save some for next year (when alowed) since it won't enhance our refund for that tax year. It also shows us all our options through the way and shows the result of our tax or refund both ways so we can make the better decision. We can also e file when its done.

We will most likely be using a tax accountant next year if things go well in year two for this business. Our taxes are pretty simple but when I get a couple of employee's this year I think we'll be using a service that covers all the bases for us like the one DavidC mentioned. We do have a good friend who is a CPA and she's been gracious enough to answer our questions during our tax prep. when needed.

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Jason E Whipple, General Manager
Historic House Restoration, Cincinnati, Ohio
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Pearce Services

If they didn't do their taxes yet, no harm!
If they did taxes, and included that revenue, again no harm!
If they did taxes, and failed to account for the revenue, I would think that they are more at risk if the IRS finds out (than you are) since they failed to report income. I would guess that the guy that doesn't report all his income, would most likely not have paid his quarterlies, and is waiting for April 14th to file his extension anyways.

Double-A

I think if you look at what the IRS says to folks that don't have their 1099-misc yet its something to the effect of, "Make every effort to get one from the company that should send one to you. If all else fails, estimate you earnings from them and ....."

In other words. You have to really screw the pooch by waiting much longer than you have to get in real trouble.

BTW. I've called the 1099 police and they are about to come knocking on your door. Right behind them is a mob of angry CPAs ready to tear you apart and lynch your "CPA in a box" tax software.

Unfortunately, the Shriners thought all this activity was a circus coming to town, so they are out in their hats and little cars. I understand 3 people and one cat have been seriously injured so far...

All because you didn't mail out your 1099's on time.

I think your do-do just got deeper.

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"My clients’ wishes are the center of my attention." -- David Guido, a contractor in Woodstock, N.Y.
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