On Demand Webinar

Form 1099 Essentials

Webinar Details $219

  • Rated:
  • Webinar Length: 100 Minutes
  • Guest Speaker:   Steven Mercatante
  • Topic:   Taxation and Accounting
  • Credit:   CPE 2.0, ATATX 1.5
All Access Membership

Form 1099 Essentials is the webinar that will help you understand what 1099 reporting is, why it is important, and what could happen to your company if it is not done. In this information packed program you’ll gain a broad understanding of Form 1099 reporting, with special focus on the Forms 1099-NEC and 1099-MISC. You’ll learn the key elements needed to comply with IRS requirements and discover how best to respond to the IRS.

Agenda:

  • Learn the key elements that make for successful 1099 reporting
  • Discover what you are required to 1099 report and how to recognize when those payments are reportable
  • Get an in depth-look at the Form 1099-NEC/MISC boxes, the most commonly used forms for 1099 reporting
  • Learn what information you need from your payee to properly report a payment
  • Discover how to use the W-9 to collect the correct information and when you are required to obtain a signed W-9
  • Find out how to use the IRS TIN Matching Program and how it can help ensure the information you have is correct

Level: Intermediate
NASBA Field of Study: Taxes
Program Prerequisites: None
Advance Preparation: None

  1. Introduction
  2. Agenda 00:00:01:13
  3. Our Focus: The Tax Gap 00:06:31
  4. The Law 00:15:33
  5. What’s New: 1099-NEC and 1099-MISC 00:23:26
  6. The 2022 Form 1099-NEC - An Overview - Reportable Payments 00:32:12
  7. The 2022 Form 1099-NEC - An Overview - Boxes 1, 2, 3, 6, and 10 00:34:17
  8. 1099 Essentials Starts With The W-9 00:42:55
  9. 1099 Essentials Starts With The W-9: Name and TIn “Cheat Sheet” 00:51:59
  10. 1099 Essentials Starts With The W-9: Name and TIn “Cheat Sheet” (Cont’d) 00:52:46
  11. 1099 Essentials Starts With The W-9 - When To Get An Updated Form W-9 00:53:49
  12. 1099 Essentials Starts With The W-9 - Payee Refuses to Provide a TIN 00:59:26
  13. Data Validation Basics - Identifying Your Payee 01:02:02
  14. Data Validation Basics - U.S. Persons 01:04:01
  15. Always Validate Claims of Non-Reportablity - Corporations 01:07:01
  16. Always Validate Claims of Non-Reportablity - The LLC 01:07:35
  17. Always Validate LLC’s - The LLC as the Disregarded Entity 01:08:39
  18. Validating Data - The Exempt Organization - Tax Exempt Organization Search Tool 01:10:02
  19. Validating Payee Data - TIN Match Program 01:11:42
  20. Validating Payee Data - TIN Match Program - Form W-9 and Vendors 01:15:03
  21. Validating Payee Data - TIN Match Program - Reducing Corrections 01:18:04
  22. Validating Payee Data - TIN Match Program - Delegated Authority 01:19:12
  23. Watch Out For The Middleman 01:19:37
  24. Correction Tips - Reasons Why 01:22:44
  25. Correction Tips - Payer Mistake 01:24:42
  26. Correction Tips - Proposed Penalties 01:26:36
  27. B-Notice Response Best Practices 01:27:14
  28. B-Notice Response Best Practices Cont’d 0132:34:
  29. B-Notice Response Best Practices - 1st Notice 01:33:05
  30. B-Notice Response Best Practices - 2nd Notice 01:33:08
  31. Protect Yourself 01:37:46
  32. Questions and Answers 01:39:46
  33. Presentation Closing 01:43:04
  • Audit 00:04:28, 00:13:44, 00:51:13
  • Backup Withholding 00:03:58, 00:13:16, 00:18:16, 00:22:13, 00:43:41, 00:59:42, 01:09:55
  • B-Notice 00:03:59, 00:13:41, 00:20:10, 00:22:13
  • CP-2100 01:27:29 
  • DBA -Doing Business As 00:45:39
  • Disregarded Entity 00:46:01, 01:08:44
  • EIN 00:43:34, 00:52:11
  • FATCA 00:28:13, 00:44:01
  • Form 1042 01:03:02
  • Form 1042-S 01:02:28, 01:02:51
  • Form 1099-B 00:23:41, 01:11:42
  • Form 1099-DIV 00:23:42, 01:11:42
  • Form 1099-INT 00:29:24, 01:11:42
  • Form 1099-K 00:29:25, 00:23:47, 01:11:42
  • Form 1099-MISC 00:02:20, 00:14:25, 00:23:28, 00:34:08, 01:11:42
  • Form 1099-NEC 00:02:19, 00:14:25, 00:23:26, 00:27:05, 00:32:28, 01:11:42
  • Form 1099-OID 00:23:43, 01:11:42
  • Form 1099-PATR 00:23:44, 01:11:42
  • Form 1099-R 00:23:47, 01:11:42
  • Form 1099-S 00:23:47
  • Form 8233 01:03:08
  • Form 8832 01:08:10
  • Form 990 01:10:41
  • Form W-8 01:02:45
  • Form W-9 00:12:55, 00:23:09, 0:42:56, 00:46:49
  • Fringe Benefits 00:33:40
  • Independent Contractor 00:03:30
  • IRC Section 3406(a) 00:18:14, 00:19:26, 00:59:54
  • IRC Section 6041(a) 00:17:55
  • IRC Section 6109(a)(2) 00:18:07, 00:59:52
  • IRS Notice 972CG 01:18:04
  • ITIN 00:43:36, 01:04:30
  • Limited Liability Company (LLC) 00:13:13, 00:46:08, 00:50:44, 00:57:50, 01:07:43
  • Nonresident Alien (NRA) 01:02:16
  • Reasonable Cause 00:16:37, 01:09:41
  • Resident Alien 01:04:12
  • Sole Proprietor 00:57:32
  • Tax Exempt Organization Search Tool 01:10:21
  • Tax Gap 00:08:54, 00:15:30
  • TIN 00:13:24, 00:20:33, 00:43:08
  • TIN Match Program 01:11:48
  • Vendor 00:03:29, 00:17:23, 00:21:52, 00:44:18, 00:59:32

Audit: A formal examination of an organization's or individual's accounts or financial situation

B-Notice: A notice from the IRS stating that one or more tax ID numbers were missing from a 1099 or do not match the IRS records.

Backup Withholding: Backup withholding is the tax that is levied on investment income, at an established tax rate, as the investor withdraws it. Backup withholding helps to ensure that government tax-collecting agencies (such as the IRS or Canada Revenue Agency) will be able to receive income taxes owed to them from investors' earnings. (www.investopedia.com)

CP-2100: It is a notice that tells a payer that he or she may be responsible for backup withholding. It is accompanied by a listing of missing, incorrect, and/or not currently issued payee TINs. Largevolume filers will receive a CD or DVD data file CP2100, mid-size filers receive a paper CP2100, andsmall filers receive a paper CP2100A.

DBA -Doing Business As: Sometimes it makes sense for a company to do business under a different name. To do this, the company has to file what's known as a DBA, meaning "doing business as." A DBA is also known as a "fictitious business name," "trade name," or "assumed name."

Disregarded Entity: A disregarded entity refers to a business entity with one owner that is not recognized for tax purposes as an entity separate from its owner. A single-member LLC ( “SMLLC”), for example, is considered to be a disregarded entity. (www.pntax.com)

EIN: The Employer Identification Number, also known as the Federal Employer Identification Number or the Federal Tax Identification Number, is a unique nine-digit number assigned by the Internal Revenue Service to business entities operating in the United States for the purposes of identification.

FATCA: FATCA was enacted in 2010 by Congress to target non-compliance by U.S. taxpayers using foreign accounts. FATCA requires foreign financial institutions (FFIs) to report to the IRS information about financial accounts held by U.S. taxpayers, or by foreign entities in which U.S. taxpayers hold a substantial ownership interest. (www.treasury.gov). FACTA (Fair and Accurate Credit Transactions Act) is an amendment to FCRA (Fair Credit Reporting Act ) that was added, primarily, to protect consumers from identity theft. The Act stipulates requirements for information privacy, accuracy and disposal and limits the ways consumer information can be shared.

Form 1042-S: Form 1042-S is used to report amounts paid to foreign persons (including persons presumed to be foreign) who are subject to income tax withholding. For an individual taxpayer, Form 1042-S is a document provided to you (and the IRS) by the payer of the income reported.

Form 1099-DIV : Form 1099-DIV: Dividends and Distributions is an Internal Revenue Service (IRS) form sent to investors who receive distributions from any type of investment during a calendar year. Investors can receive multiple 1099-DIVs. Each Form 1099-DIV should be reported on an investor's tax filing.

Form 1099-INT: Form 1099-INT is the IRS tax form used to report interest income. The form is issued by all payers of interest income to investors at year end and includes a breakdown of all types of interest income and related expenses. Payers must issue Form 1099-INTs for any party to whom they paid at least $10 of interest during the year.

Form 1099-K: A payment settlement entity (PSE) must file Form 1099-K for payments made in settlement of reportable payment transactions for each calendar year. A PSE makes a payment in settlement of a reportable payment transaction, that is, any payment card or third party network transaction, if the PSE submits the instruction to transfer funds to the account of the participating payee to settle the reportable payment transaction.

Form 1099-MISC: The Form 1099-MISC is an Internal Revenue Service (IRS) tax return document used to report miscellaneous payment?s made to nonemployee individuals, such as independent contractors, during the calendar year. (www.shrm.org)

Form 1099-NEC: In the context of 1099 tax filing, NEC stands for “Nonemployee Compensation” (the first letters of the three words None, Employee and Compensation). Most tax payers recognize NEC as box 7 on Form 1099-MISC. NEC is used to report income paid to independent-contractors / the-self-employed (referred to as 1099 employees for simplification purposes). So, while employers report income that gets paid to employees on Box 1 (Wages, tips, other compensation) of the W2 form, payers report income that gets paid to none-employees on Box 7 (NEC) of the 1099-MISC form. As an individual, if you received form 1099-MISC instead of Form W-2 then the payer did not consider you an employee and did not withhold income tax or social security and Medicare tax.

Form 1099-OID: Form 1099-OID is a tax form intended to be submitted to the Internal Revenue Service by the holder of debt instruments which were discounted at purchase to report the taxable difference between the instruments' actual value and the discounted purchase price.

Form 1099-PATR: File Form 1099-PATR, Taxable Distributions Received From Cooperatives, for each person to whom the cooperative has paid at least $10 in patronage dividends and other distributions described in section 6044(b), or from whom you withheld any federal income tax under the backup withholding rules regardless of the amount of the payment.

Form 1099-R: Form 1099-R is a tax form from the Internal Revenue Service (IRS) for reporting distributions from annuities, profit-sharing plans, retirement plans, IRAs, insurance contracts, or pensions.

Form 8233: IRS Form 8233 must be completed when a non U.S. citizen is claiming tax treaty exemption from income taxes for income received for services provided as an independent contractor.

Form 8832: Form 8832 is the Entity Classification Election form from the IRS. It is filed to elect a tax status other than the default status for your entity. For example, an LLC can elect to be taxed as a C Corporation.

Form 990 : Form 990 (officially, the "Return of Organization Exempt From Income Tax") is a United States Internal Revenue Service form that provides the public with financial information about a nonprofit organization. It is often the only source of such information.

Form W-2: Form W-2 is an Internal Revenue Service tax form used in the United States to report wages paid to employees and the taxes withheld from them. Employers must complete a Form W-2 for each employee to whom they pay a salary, wage, or other compensation as part of the employment relationship. - Wikipedia (https://en.wikipedia.org/)

Form W-9: Form W-9 (officially, the "Request for Taxpayer Identification Number and Certification") is used in the United States income tax system by a third party who must file an information return with the Internal Revenue Service (IRS). It requests the name, address, and taxpayer identification information of a taxpayer (in the form of a Social Security Number or Employer Identification Number). - Wikipedia (https://en.m.wikipedia.org/)

Fringe Benefits: An extra benefit supplementing an employee's salary, for example, a company car, subsidized meals, health insurance, etc.

IRC Section 3406(a): Requires that, under certain circumstances, including the payee's failure to provide a TIN, the payer must perform backup withholding.

IRC Section 6041(a): Provides that persons engaged in trade or business must report certain payments on an information return.

IRC Section 6045: Every person doing business as a broker shall, when required by the Secretary, make a return, in accordance with such regulations as the Secretary may prescribe, showing the name and address of each customer, with such details regarding gross proceeds and such other information as the Secretary may by forms or regulations require with respect to such business.

IRC Section 6109(a)(2): Requires that a payee provide a TIN to the payer when the payment will be reportable on an information return.

IRS Notice 972CG: The IRS started mailing 972CG penalty notices in July 2013 regarding 1099's with missing or incorrect TIN/Name Combinations. A 972CG is a NOTICE OF PROPOSED CIVIL PENALTY. A simple way to prevent this costly penalty is to verify that your information is correct prior to filing.

ITIN : An Individual Taxpayer Identification Number is a United States tax processing number issued by the Internal Revenue Service. It is a nine-digit number that begins with the number 9, and the 4th and 5th digits, also known as second section, range from 70 to 88, 90 to 92 and 94 to 99.

Independent Contractor: An independent contractor is a person or entity contracted to perform work or provide services to another entity as a non-employee. As a result, independent contractors must pay their own Social Security and Medicare taxes. - Investopedia (https://www.investopedia.com/)

Limited Liability Company (LLC): An LLC is a corporate structure where members cannot be held accountable for the company’s debts or liabilities. This can shield business owners from losing their entire life savings if, for example, someone were to sue the company. Can be a single member (much like a sole proprietor) or a multi-member. It shares certain traits of both corporations as well as partnerships or sole proprietorships. It is not a corporation.

Nonresident Alien (NRA): This income is taxed at a flat 30% rate, unless a tax treaty specifies a lower rate. Nonresident aliens must file and pay any tax due using Form 1040NR, U.S. Nonresident Alien Income Tax Return or Form 1040NR-EZ, U.S. Income Tax Return for Certain Nonresident Aliens with No Dependents.

Reasonable Cause : Reasonable cause is based on all the facts and circumstances in your situation. The IRS will consider any reason which establishes that you used all ordinary business care and prudence to meet your federal tax obligations but were nevertheless unable to do so.

Resident Alien : A resident alien is a foreign person who is a permanent resident of the country in which he or she resides but does not have citizenship. To fall under this classification in the United States, a person needs to either have a current green card or have had one in the previous calendar year.

Sole Proprietor: A business that legally has no separate existence from its owner. The sole proprietorship is the simplest business form under which one can operate a business. The sole proprietorship is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts.

TIN: A Taxpayer Identification Number is an identifying number used for tax purposes in the United States and in other countries under the Common Reporting Standard. In the United States, it is also known as a Tax Identification Number or Federal Taxpayer Identification Number.

TIN Match Program: TIN Matching is part of a suite of Internet-based pre-filing e-services that allows “authorized payers” the opportunity to match 1099 payee information against IRS records prior to filing information returns.

Tax Exempt Organization Search Tool: Tax Exempt Organization Search helps users find information about a tax-exempt organization’s federal tax status and filings.

Tax Gap: The gross tax gap is the difference between true tax liability for a given tax year and the amount that is paid on time. It is comprised of the nonfiling gap, the underreporting gap, and the underpayment (or remittance) gap.

Vendor: A vendor is a person or business that supplies goods or services to a company. Another term for the vendor is the supplier. In many situations, a company presents the vendor with a purchase order stating the goods or services needed, the price, delivery date, and other terms.


Guest Speaker

  • Steven Mercatante

CPE Credit

Continuing Professional Education

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ATATX Credit

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