Gregg McCumber, CPA - Partner and
Richard Walker, CPA - Partner (Posted: 1/3/2013)
Beginning with the filing of the 2011 individual income tax returns and various
entity returns, taxpayers were required to answer the following two questions. These
same two questions also appear for tax year 2012.
- Did the taxpayer make payments during the year that required the filings of
Form 1099-MISC for such payments?
- Did the taxpayer issue and file all required Forms 1099-MISC?
Forms 1099-MISC are required to be prepared by all business entities and individuals
(for profit and nonprofit) who make payments that total $600 or more during the tax
year to any payee who is an individual or partnership with respect to the performance
of personal services, rents for tangible and real properties, and royalties. Such
forms must be provided to all payees by January 31st of the following tax year and
filed with the IRS no later than February 28th.
The penalties for failure to timely file such forms with the IRS are as follows:
- $30 for each Form 1099-MISC filed within 30 days after February 28th
- $60 for each Form 1099-MISC filed after March 30th but prior to August 1st
- $100 for each Form 1099-MISC filed on or after August 1st
Penalties can increase if the IRS determines the taxpayer willfully disregarded the
rules for filing these required forms. Proof of intentional disregard is supported
where the taxpayer fails to truthfully answer the questions above. Therefore, we
strongly recommend that all taxpayers who are required to file Form 1099-MISC for 2012
prepare to do so in a timely manner by requesting (if not already done) a completed
Form W-9 from each vendor and payee. The completed W-9 contains the information
necessary for taxpayers to prepare Forms 1099-MISC and thus comply with the IRS filing
Please contact your Burton McCumber & Cortez, LLP service provider if you have any
questions or need additional information.