The Art of Mastering Taxes
on 03/05/2018

Guidelines in Preparing Information Returns

Information returns are also known as 1099 tax designations. These information returns are collected to monitor each revenue paid. Below is a guide on how to fill it out.

Also called as the independent contractor form, this form shows how much you have paid someone for the questioned tax year. For example, you would have to issue a 1099-MISC of $1,200 per year for getting the services of a lawn mower at $100 per month. This way, IRS keeps track of the revenues reported by the gardener.

First of, you have to know the proper form in filling up a tax designation. Make sure you are using the MISC version as there are many types of 1099 forms. IRS won’t accept unofficial copies so don’t print the ones you see online. This is because IRS computers will read the forms and if you’re not using the official copy, you will have to fill up another form again. Official copies are readily available in big libraries, major post offices and IRS offices near you. To make sure you didn’t get the wrong copy, you to the nearest IRS Office to ask some. You may also order online and have it directly delivered to you.

IRS made the filling out of forms a lot easier. Start by printing a copy of the form with your printer so you can just throw it away if you make a mistake. Then compute the total amount you paid to the people you are making the report for. Then, tally how much you have paid for someone.

Write your name on the top left box of the form. Then you have to fill up your general information including your name/business name, phone number, email address and address. Write your tax identification number next in one digit per box. And to the right of your tax identification number, write the tax identification number of the person you are reporting for. On the bottom of the two boxes, write the address and name of that person.

Now write down the total amount. The remaining boxes in the middle form are to be filled by some but if you don’t know what’s asked, just leave it blank. The box that appears first is the “1 Rents” field. Paid rentals that has to be reported shall be provided in this field. For basic fees paid for services within the year, report on box 7. This one is for the “nonemployee compensation.” This field is the one that’s commonly requested so if you are having a hard time classifying your report, use this field.

And there you have it! Once you’ve filled it out, mail the form and get another hard copy of it along with form 1096 which serves as the cover sheet of the forms you’re sending to IRS.

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