New Rules for Submission of 1099-MISC Forms

Good article recently from one of my favorite publications, CPA Practice Advisor. They note two big changes for filing of 1099-MISC forms.

New IRS rules for submitting late 1099-MISC with Box 7

After January 31, 2019, 1099-MISC with Box 7 filled in should be filed separately from 1099-MISC with any other box filled in. As an example, on February 5, if you have a 1099-MISC with Box 7 and a 1099-MISC with only Box 1 filled in and your e-file provider has put them in the same record, as per last year’s format, the MISC with Box 7 will be flagged as late, which indeed it is. The challenge is, however, that the 1099-MISC with Box 1 may also be flagged as late, even though it is not, since it is not due until Mar. 31.

If companies do accidentally submit non-Box 7 1099-MISC along with late Box 7 forms and get a Notice 972CG (A Penalty is Proposed for Your Information Returns), according to the IRS they may respond and clarify the content of the submission, indicating the number of Forms 1099-MISC that did not report Box 7.

More on this from the IRS here:
https://www.irs.gov/forms-pubs/changes-to-current-forms-publications/filing-forms-1099-misc-with-nec-in-box-7-with-the-irs-dec-2017

New 1099-K State Filing requirements with Gross Amount more than $600

The IRS does not currently require companies to submit 1099-Ks unless the Box 1a Gross Amount for the year is at least $20,000. However, individual states have become attuned to the income reporting possibilities with this form and are mandating submission of the 1099-K for gross payments more than $600. This $600 is the same threshold for 1099-MISC Box 7 reporting.

At the moment, Massachusetts and Vermont have implemented the reporting requirement for 1099-K with more than $600. Be sure to stay up to date with your particular state’s rules as they may pick up this requirement in the future.

Source: New Rules for Submission of 1099 Forms | CPA Practice Advisor

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