If you work in the form of an independent contractor, it is quite likely for you to receive the IRS 1099 MISC form. You will receive this form from the businesses that made payments of over $600 for the services that you provided. However, there are a lot of people who do not receive this form. There are even people who completely misunderstand the MISC form. The 1099 MISC is in no way a tax return per se but it is basically information return. IRS uses this form for tracking the amount of revenue that an individual contractor gets from his or her clients. This form can be filed in person or if you want you can even file 1099-misc online.
The Only Thing that Needs to be Done
An individual who pays $600 or something above this amount to an independent contractor should file form 1099 with the Internal Revenue Service. However, there are certain exceptions to the $600 figure. An individual issuing form 1099-misc must send it to the contractor within 31st January. The individual must file this same form with the IRS within the month of February. An individual who receives IRS 1099 MISC form does not need to do anything with the form. The only thing that needs to be done is carrying out a thorough check for ensuring that the payments that have been reported are perfect and accurate. But, what if an individual does not receive this form?
What to do if you do not Receive Form 1099 MISC?
For many people, it goes completely out of mind to file 1099-misc online. Because, this is information return, people are not able to get around it and it simply slips out of their minds. Individuals need to pay a penalty if they are unable to file form 1099-misc with the IRS and the contractors and this penalty is usually under $100. Briefly speaking, this is not much of a penalty for motivating the people. However, it is to be noted that as an individual contractor, if you do not receive form 1099, you still have the obligation of reporting the revenue that you earned from serving in the form of an individual contractor. The fact that the form of was reported to the IRS does not mean that you get the flexibility of not paying your individual taxes. You must bear the responsibility of reporting your revenues whether you received form 1099 misc or not. It is necessary for you to go through your books and identify the amount you were paid from your customers.
An Important Concern
Another important thing that you should keep in mind is that you must not get overwhelmed with the new business that you have in hand and forget to pay your taxes. It is always good for you to get hold of an experienced and professional tax consultant who would be able to calculate the estimated taxes. The rules and the regulations surrounding the payments of taxes for form 1099 MISC is a little complex due to the details involved. Therefore, you must be very careful when filing the tax return form. It is best to file 1099-misc online.