It’s a fact that this blank can be used for various specific purposes but the initial intention is simple – provide a report about annual money transactions.
1099 form definition should be as clear as that. Non employee workers has to account for the income – no matter how much it was.
MISC paper has to be taken into account if you consider yourself as an independent contractor, ready to work for yourself and take care of your own taxes.
Why 1099 is sent to me?
Freelancers receive this blank to report and pay their year round levy. Income and Social Security/Medical care taxes are being calculated and paid by non-employee worker, not in half like by those who have chosen W2 (employed people). If you haven’t received your sample by the end of January – contact work giver first or IRS directly. Make sure you are able to provide SSN, your personal info and correct dates you were employed when you call IRS. If you don’t solve the issue till deadline of April 15th the penalty will be applied to you.
Rule of six hundred dollars
The $600 rule applies to the enterprise you provided services for, who’s surprised?
The IRS requires that MISC should be given for individual who earned equal or more than 6 hundred bucks working for a company as freelancer. If the sum is less, even $599 owner is not required to provide you the MISC form, but you are obliged to state it in tax return.