Page 4 - 1099 Ebook

What Are The Penalties
for Non-Compliance?

Late filing penalties are $50 per
1099 if filed within 30 days of
the due date; $110 per 1099 if
filed by August 1; and $270 per
1099 if filed after August 1.
Noncompliance penalties are
$550 per 1099.
How Does the IRS
Monitor Compliance?

Two questions are asked on tax
returns (including Form 1040
Schedules C & E) regarding
whether any needed to be sent,
and if they were sent as
required. Keep in mind that
What Information Is signing a tax return indicates

Needed From Vendors? (under penalty of perjury) that
you have answered truthfully.
The W-9 is similar to a W-4
completed by employees for
employers. It requests the
business or individual's name,
address, type of legal entity, and
EIN or Social Security Number.

What If An Individual
Won't Provide Their SSN?

An individual can apply for an
EIN for free via the IRS website,
if they would prefer not to give
their SSN, but they must
comply with completing the
W-9. Please refer them to the
What If A Vendor Won't W-9 instructions for more
Return a W-9? information.

The IRS stipulates that a
business should withhold and
remit 20% of all payments
made to a vendor as federal
withholding, if the vendor will
not comply with submitting a
W-9. These withholdings are
then reported on the 1099..