Friday 31 January 2014

Have You Started Your 1099-M Tax Forms? Pay Now or Pay Later



File the 1099-M’s you must file, or now you pay penalties:

1099-M's are tax forms that the Internal Revenue Service, or the IRS, requires people to file if they have paid more than six hundred dollars to an independent contractor. The paperwork procedure for this type of tax form filing essentially consists of the small business owner or landlord that has hired the services of independent contractors for more than six hundred dollars will need to fill out their part of a 1099-M and send it to each of the contractors by the end of January. These contractors must then send the forms in to the agency by the end of February, although if they are filing each of the forms electronically, they have until the third of March.

                              

It is highly recommended to hire the services of a company that specializes in filing such forms because they will be able to ensure that the filing procedure is performed correctly. This could include making sure that there are no duplicate forms in the system, which would confuse the IRS and make them more likely to perform an audit. It is also highly recommended to purchase software that will be able to take each of the independent contractors to whom the 1099-M's are being sent and process them in the accounting system automatically. This will ensure that all of the necessary forms are sent out on time.

If the forms are not filed by the deadlines, there are certain penalties depending on how late each for was filed. Thirty dollars is charged for the first thirty days that a form is filed late, up until March 30, with a maximum charge of $250,000 per year. The second thirty days incurs a charge of sixty dollars with a maximum penalty of $500,000, and one hundred dollars if the charges are filed after August 1.

Essentially, to avoid having to pay these penalties, it is crucial for a small business or landlord to file the forms on time. Hiring the services or purchasing software that has been designed for such a purpose will make the overall procedure go much more smoothly, with less frustration.
 For More Information Please Visit - omgtax.com


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