Does An Individual Who Pays An Independent Contractor For Repairs Have To File A 1099

You don't accept to provide a 1099 for a repairman in your domicile.

The Internal Acquirement Services uses 1099s to rail payments fabricated to independent contractors and self-employed individuals. Businesses must upshot 1099s to other businesses or individuals they rent to perform work for them. Equally an private, you lot don't take to follow these same rules. The washing motorcar repairman, roofer or plumber you hire to repair stuff at your home isn't expecting anything from you come up taxation time.

Businesses and 1099s

The Internal Revenue Service requires businesses to send a 1099 to anyone to whom they paid $600 or more in fees, rentals, prize money or other cash payments. The 1099 must listing the name of the business or person the money was paid to, the total corporeality paid during the year, and the Social Security number or tax identification number for the person or business. Most businesses require subcontractors and others for whom they anticipate filing a 1099 to provide a form W-9, which lists the business name and the tax identification number.

Self-employed Taxes

Self-employed repairmen and others who work for themselves are required to report all their income to the IRS, whether they receive a 1099 or not. A repairman whose clients are mostly other businesses might receive 1099s that closely match his actual income, but someone who works with many private clients, such every bit a residential plumber or handyman, would receive very few and perhaps no 1099s.

Household Employees

If instead of hiring a self-employed person to gear up things effectually your habitation you lot decide to hire your own maintenance man, you could be required to pay taxes for this person, who would be considered your employee if you lot set the person's hours, dictate his duties and how the duties should be done. For instance, if y'all hire Joe's Plumbing to install a new toilet, Joe decides when to show up, how long to accept to practise the task and what materials to use. If you lot rent Joe as your handyman, instruct him to install the toilet at 9 a.m. and provide him with the materials to use, the IRS considers Joe to be your employee. You may need to pay the employer's share of Social Security and Medicare taxes, likewise as unemployment taxes, for any employees. However, this would not require a 1099.

Other Considerations

If you're self-employed and operate a business concern in your home, whether or not you lot need to send a 1099 to a contractor depends on the job they do and whether the repair benefited your concern or your dwelling. Calculator repair or wiring your office phone lines are business expenses and require a 1099. Painting your living room isn't a business expense and doesn't crave a 1099. If you paid for the work out of your business organisation account, it requires a 1099. If the corporeality you paid to the repairman was less than $600, you don't have to ship a 1099 regardless of whether information technology was a business or personal expense.