1099-MISC related questions?
1099-MISC related questions?
I have c-corp registered in NV and I used lot of Internet based freelancers and consultants in 2008. I read about issuing 1099-MISC to those whom I paid over $600 in a given year. In a related note, I have following questions:
(a) What do I need to report if freelancer/consultant is offshore resource (India based)
(b) For US based consultants, how would I generate 1099-MISC? Can I download form from IRS site and issue them to those consultants? Do I need to have a professional accountant or certain software to issue 1099-MISC?
(c) For Services of December 2008, I paid to a consultant in Jan 2009. Do I include that payment in 1099-MISC for 2008?
Thanks
Dave
Answers:
viajero_intergalactico: for a, and b use Turbo Tax...it can generate the 1099s
for c, that depends on your accoundting method.
if you use cash method, then its a 2009 expense
if you use accrual method, then its a 2008 expense.
you must use only one method for the whole year and if you want to change the method you must get permission from the irs to do so.
2009-01-05 15:50:45
2009-01-05 15:50:45
princessniccii: these questions are really good questions, but VERY hard for me to explain the answers to. You should go talk to you local HR Block office, advice free!
2009-01-05 15:53:55
2009-01-05 15:53:55
Chosen Answer
v b: a) The consulting work that *wasn't* physically done in the US by people who aren't US Citizens or US residents is NOT reported to the IRS. However, you need to create a contract that confirms this. "Under penalties of perjury" the person did the work in India and is NOT a US citizen or US Resident alien for tax purposes. Without such a document, you were to assume the work *was* Us-source (and withhold 30%) or was done by US labor (withhold 28%). b) You can't download 1099-Misc and 1096, these are machine readable forms. Go to irs.gov and order them. c) If you pay in 2009, you 1099-Misc them by 1/31/2010.
2009-01-05 16:14:04
v b: a) The consulting work that *wasn't* physically done in the US by people who aren't US Citizens or US residents is NOT reported to the IRS. However, you need to create a contract that confirms this. "Under penalties of perjury" the person did the work in India and is NOT a US citizen or US Resident alien for tax purposes. Without such a document, you were to assume the work *was* Us-source (and withhold 30%) or was done by US labor (withhold 28%). b) You can't download 1099-Misc and 1096, these are machine readable forms. Go to irs.gov and order them. c) If you pay in 2009, you 1099-Misc them by 1/31/2010.
2009-01-05 16:14:04