As you receive payments for items and services, you will need to file the correct 1099 Form to report your various types of income you recieve during the year. This income is separate from wages, salaries, and tips. Along with filing with the IRS, you will also need to provide your independent contractors and your recipients with the proper 1099 Form so they can file their tax returns.
But don’t let information returns become overwhelming when TaxBandits is here to make them easy! Check out these 6 important 1099 Forms to remember!
6 Important 1099 Forms
Form 1099 is used to report all other forms of income received during the tax year. It’s used to report things like payments to freelancers, independent contractors, rental property income, sales proceeds, interest and dividends, and miscellaneous income.
- Form 1099-INT
Form 1099-INT is an annual tax statement filed by those who pay interest income, like banks, financial institutions, government institutions, and more. You are required to file this form to report interest income amounts equal to or greater than $10 to the recipient and IRS. This form is also used to report tax items related to your interest income like early withdrawal penalties, tax-exempt interest market discount, and federal taxes withheld.
- Form 1099-MISC
This is the most popular 1099 Form, as it’s used to report miscellaneous income. Employers send these forms to freelancers and independent contractors if they paid them $600 or more for their services. Other income reported on this form includes rental payments, awards, substitute payments in lieu of dividends, and more.
- Form 1099-C
Form 1099-C is used to report any cancellation of debt. Debt is canceled when you initially receive money, but you aren’t required to pay it all back to the borrower. The IRS considers this taxable income because you are not paying the debt back. Examples of when debt can be canceled include student loans, credit cards, home loans, and more.
Have you sold a home? If so, then you have probably used Form 1099-S, which reports the details of real estate transactions. You will receive this form from your broker and are responsible for sending it to your recipient.
- Form 1009-DIV
This form is used when you’ve earned income from stocks. Investment fund companies will send this form to investors if they have received or reinvested $10 or more into a fund. It’s used to report dividends both ordinary and qualified, total capital gains, non-taxable distributions, federal income tax withholdings, foreign tax paid, and foreign source income from each investment account held by a fund company.
- Form 1099-R
Form 1099-R is used to report distributions from pensions, annuities, IRAs, Insurance contracts, retirement or profit sharing plans, charitable gift annuities, and more. This form is filed when a person receives $10 or more from a distribution. Some of the information required to complete the form includes the taxes withheld, total distribution, the total taxable distribution, and distribution type code.
Happy Information Return Filing
Once you know which 1099 you need to file its smooth sailing from there. Especially if you use an e-filing solution like TaxBandits to help you complete your Form online in a matter of minutes. Currently, information return wise, TaxBandits support Form 1099-MISC, Form 1099-INT, Form W-2, and Form W-3.