A couple of weeks ago a tax-pro-turned-photographer named Brandon Scott helped us navigate the approaching tax deadline with some helpful tips. Now that most of us have (hopefully) filed our 2016 returns, I thought it would be a good time to chat about 1099 forms. If you're like me, you not only hire independent contractors, but you act as one too. Here is a rundown of all things 1099.
Just like last time, it's important to always check with your accountant before you do anything. Laws vary state to state, so treat the advice below as a guideline of things to bring to the attention of your professional accountant. Fstoppers assumes no liability for this article.
What Is a 1099 and Who Gets One?
A 1099 form is a document the IRS requires to report anything you pay to an independent contractor. The most common independent contractor a photographer may pay would be an assistant or second shooter, office manager, or photo editor. Scott refers to 1099 forms as the self-employed person's W2.
You have to send a 1099 to any Individual you paid to perform services that totaled up to $600 for the year. These are your second shooters and your outsourced editors. You also have to send one to individuals you paid rent or lease payments to for either real estate or equipment.
Maybe you rented a bunch of gear from BorrowLenses. Does that mean you have to send them a 1099? You don't have to send a 1099 to any corporation, nor do you have to send one to any contractor you paid less than $600 to for their services in total for the year. What if you paid a second shooter exactly $600? Send a 1099.
How to Get a 1099 Form and When They Are Due
The IRS will mail you 1099s for free, and it just takes a week or two. You can go here to request any and all forms. Scroll down to the 1099-MISC form and enter the number you want. If you need forms faster, you can get them at Staples or Office Depot, or even Amazon. It's super important that you get official forms. You can't print them online because they're printed on special paper with fancy ink. All 1099s are due on January 31.
A Quick How-To
Here is Scott's step-by-step guide on how to handle 1099 forms.
- Get blank 1099-MISC forms and one 1096 form. The 1096 is a cover page that summarizes all the 1099s. Make sure you get the special 1099 envelopes, and some stamps.
- Gather a list of people you paid $600 or more to for the year.
- Get the name, mailing address, and EIN or Social Security Number for each of those people. The IRS makes a form you can use to request this info called a W-9. I usually send people a quick text instead of using that form, but do whatever you feel comfortable with.
- If the 1099 is for a second shooter, enter the amount you paid them in Box 7. If it's for a landlord, fill in Box 1.
- Once you've filled out a 1099 for each person, add up all the Box 7s and Box 1s and put the totals in the matching boxes on the 1096.
- Put the 1096 and all the Copy A 1099s into a pile. This pile goes to the IRS.
- Put all the Copy Bs and Copy 2s in a pile for each person. These piles go to the people.
- Put your Copy 1s in a pile. These go to your state if it's required. The IRS automatically shares 1099 info with California, so I get to throw this pile away. Do a quick Google for your state.
- Put all the piles in envelopes and send. The IRS pile goes to the address listed on the back of the 1096. It's a different address depending on your state.