Last year I published a podcast about W-2's and 1099's that I think is worth repeating. It's getting to be that time of year and we need to be thinking about some of the things we have to do to get ready. As a business owner with employees or subcontractors you will be required to issue W-2's to employees and 1099-Misc to non-incorporated, non-employee service providers.
Subcontractors and service providers who are not incorporated must provide a form W-9 to you. You'll use this information to issue a 1099 to them if they were paid $600 or more in the tax year. You can download form W-9 at IRS.GOV. I generally mail this form to all subcontractors with their first payment. If you haven't done this yet, then it would be a good idea to mail or fax these out now so you will be prepared to process forms next month.
Form W-2 for Nevada employers is a 4-part document. You will issue 2 copies to the employee, keep one file copy with your payroll records and submit one copy along with transmittal form W-3 to the Social Security Administration.
Form 1099 in Nevada is a 3-part document. One copy remains with your payroll or vendor records, one is mailed to recipient, and one copy along with a transmittal form 1096 is mailed to the IRS. Employee and vendor copies must be distributed or postmarked no later than 1.31.13 and federal transmittals are due no later than 2.28.13.
In Nevada, we don't have personal income tax, so be sure to become familiar with your state's filing requirements now to assure that you are compliant.
Here's a simple checklist I use each Fall to get ready:
1 - Verify current employee information -create a simple form that you can attach to the next paycheck for each employee requesting their name, current address, social security number. I also include a line for their signature and the date they complete the form.
2 - Download Form W-9 - you can fill out this form online, then print multiple copies for distribution to any vendors who will receive a 1099 form. Independent contractors and other non-incorporated service providers who received $600 or require issuance of a 1009. I like to get these mailed or faxed no later than November 15th. I create a check-list of all that I submit and then attach returned forms to the list. You can download this form at www.irs.gov.
3 - Order forms now - order W-2's, 1099's and corresponding envelopes now. You can go to my website for special money saving offers. If you issue W-2's or 1099's for multiple companies, you may want to contact the IRS to order extra W-3 transmittal and 1096 transmittal forms. Additionally, if you issue 1099 Interest forms, you may want to order those directly from the IRS. Go to the IRS website for more information.Office supply stores will not, however, offer W-3 transmittals or 1096 transmittals separate from kits or bundles. When you purchase a package of 50 W-2's or 1099's, the manufacturer includes 1 or 2 transmittals. I like to order extra transmittals directly from the IRS at 800-829-FORMS; they're free. By the way, you can order any tax related form from the IRS, but remember, they are not computer friendly! Pay for the forms; order the transmittals only from the IRS.
4 - Make sure your tax tables are up to date - If you are using QuickBooks, be sure your subscription is up to date and that you are downloading updates when prompted. Peachtree users - make sure you order the tax tables for 2013 soon to assure that you are ready for end of year processing.
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