Michelle Loretta is a consultant for wedding and event professionals and writes daily for the Sage Wedding Pros’ business blog. She blends her past as an accounting nerd, sales vixen, and stationery entrepreneur to help photographers better their businesses.
If you have second shooters or are considering hiring contractors to assist you on photo shoots, there is one important tax form you’ll need to supply them with this January 2013. It is form 1099-MISC. This isn’t a new form, but the IRS is being a lot more diligent about ensuring that contractors are reporting income.
Here’s what you need to know regarding the 1099:
1) You’ll need your contractor’s vital information (name, address, social security number or tax ID) before filling out the 1099. You can get this from them any way you want but the IRS’ W9 form gives you the ability to get the info from them in a systematic way. It also shows your contractors that you will be filing 1099s for them in the off-chance they were hoping to illegally not state the payments you made to them. (Note: The W9 is NOT a legal requirement and you do not need to send it to the IRS.)
2) The IRS 1099-MISC form is one that you have to fill out for any contractor/vendor to which you paid $600 or more.
3) The misunderstanding of this form is that you only need to submit it for independent contractors that you’ve hired to do work (second shooters, for example). But ANY non-corporate business (sole proprietor, partnership, LLC, etc) that you hired to do any work that totaled more than $600 in the year will need to receive a 1099-MISC form. If they are an incorporated business, you do not need to send this. (There are a few types of 1099s. The one that typically refers to miscellaneous contractor income is the 1099-MISC.)
4) This would include (but not limited to):
- graphic and web designers hired to do your branding
- rental services
- commissions paid to non-employees
- mileage reimbursement paid to non-employees
- weekend assistants
- second shooters?and the list goes on …
5) In 2011, the IRS added a statement to the income return (1040) that will ask you if you are required to file any 1099s and if you already filed them (or, are planning to do so).
6) The 1099 has to be issued from an official IRS 1099 3-part form. (This isn’t a form you can download from the IRS site.) You can get the official IRS form by requesting one from the IRS or buying forms at an office store (Staples or Office Max, for example.) A copy of the 1099 is given to the contractor and it is their responsibility to submit to the IRS with their tax return.
Lastly, make sure that the person you’ve hired as a contractor is INDEED a contractor and not employee. Visit our blog to learn more about contractors.
Need more help? Make sure to check out The People Plan, our easy-peasy hiring and training tools. www.thepeopleplan.biz
Please reconfirm this information with a tax attorney or CPA or both! Better to be over prepared than under, right?