Webinar Details $199
- Webinar Length: 100 Minutes
- Guest Speaker: Steven Mercatante
- Topic: Taxation and Accounting
- Credit: CPE 2.00, ATATX 1.50, IRS 2.00
With constant revisions to Forms 1099 and related rule changes, it is crucial to remain up-to-date with the current information reporting laws to avoid those dreaded penalties and interest, not to mention the time consumed to make corrections. Whether you are new or seeking an update, this course will provide CPAs, Accounts Payable, Payroll, and Tax professionals with plain English guidance to help minimize 1099 filing mistakes while breaking down the tough 1099 payee and payment reporting situations, such as those involving middlemen, agents, liens, and garnishments.
In this course, industry expert and corporate tax attorney Steven D. Mercatante Esq. explores some of the more common problems experienced by CPAs, accounts payable, and tax departments related to documenting, validating, and reporting payee information on IRS Forms 1099. He identifies key issues and best practices for addressing them.
Your Benefits For Attending:- Determine which 1099 to use and watch out for key trouble spots on the most commonly filed Forms 1099.
- Identify W-9 document validation best practices, with a focus on situations when multiple names are provided, handling undocumented payees, exempt payees, and best practices for handling reporting when multiple parties are involved in the transaction.
- Target categories of payees and payments that can lead to 1099 reporting when the reporting does not necessarily follow the check.
- Receive tips on recent 1099 changes.
- Learn about tricky situations involving the identification of the beneficial owner of the income for 1099 reporting purposes.
- Get help determining when a garnishment or lien payment made to a court or an attorney is reportable and to whom.
- You sometimes face difficult payment situations involving multiple parties and struggle to identify to whom you should report the payment.
- Your 1099 validation and reporting procedures are not set up properly to help in identifying the beneficial owner of the income and to whom you should report.
- You are a CPA or work in Accounts Payable and need to understand these complicated topics.
- Introduction
- The Law 00:01:28
- What’s New 00:15:37
- What’s New: Form 1099-NEC 00:28:05
- Form 1099-NEC 00:28:48
- The Form 1099-NEC - Reportable Payments 00:34:28
- 1099-MISC 00:35:49
- 1099-MISC Attorney/Settlement “Middleman” Issues 00:43:13
- 1099-MISC Attorney/Settlement “Middleman” Issues - Example 00:53:30
- 11099-MISC Attorney/Settlement “Middleman” Issues - Special Rules On Delivery 00:54:20
- Other Legal “Middleman” Issues - Garnishments and Levies 01:02:03
- Middleman Basics - “The Middleman” 01:08:25
- Middleman Basics - Questions 01:13:06
- Middleman Basics - Key Issues: Management or Oversight 01:17:36
- Middleman Basics - Key Issues: Significant Economic Interest 01:21:52
- Middleman Basics - Knowing Who The Beneficial Owner Is 01:23:50
- Middleman Basics – Outsourced Payments 01:28:16
- Middleman Basics – Charitable Donations 01:28:21
- Middleman Basics – Agent Payments 01:
- Protect Yourself 01:35:26
- Attendee Questions 01:36:31
- Presentation Closing 01:42:04
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Steven Mercatante
Steven Mercatante is the principal and founder of TIR Consulting, LLC. He is a nationally recognized leader in tax reporting education and consulting on specialized compliance issues. He has conducted on-site consultation for corporate clients from across the world and led countless seminars and web [...]
CPE Credit
Aurora Training Advantage is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org.
For more information regarding administrative policies such as complaint and refund, and cancellation please contact our offices at 407-542-4317 or training@auroratrainingadvantage.com.
You must answer all questions during the webinar, view the recording completely and pass the test at the end with 70% correct answers to receive CPE credit.
ATATX Credit
Aurora Training Advantage is offering continuing education points designed to recognize dedication to training and excellence in accounting.IRS Credit
- Artificial Intelligence (AI) 00:10:39, 00:12:26
- Audit 00:02:59, 00:04:33
- Backup Withholding 00:07:59
- B-Notice 00:07:33
- Compensatory Damages 00:56:13, 01:02:09, 01:04:10
- Contract 01:13:19
- Disregarded Entity 01:09:31
- Due Diligence 00:06:28
- Exempt 00:48:21
- Expense Reimbursement 00:48:02
- Federal Insurance Contributions Act (FICA) 01:04
- FIRE - File Information Returns Electronically 00:16:24
- Form 1099 00:15:43
- Form 1099-INT 00:53:29
- Form 1099-MISC 00:28:20, 00:35:31, 00:35:49, 00:44:49, 00:53:18
- Form 1099-NEC 00:26:56, 00:27:44, 00:28:48, 00:35:30, 00:43:31, 00:54:12
- Form W-2 00:15:43, 00:26:57, 00:27:44, 00:32:02, 01:03:53, 01:07:46
- Form W2-G 010:37:16
- Garnishment 00:00:06, 01:
- Gross Proceeds Payment 00:13:31
- Independent Contractor 00:30:19, 00:40:22, 00:48:34
- Information Returns Intake System (IRIS) 00:16:08, 00:18:38
- IRC Sec. 3406(a) 00:01:28, 01:06:07
- IRC Sec. 6041(a) 00:01:28, 00:38:57
- IRC Sec. 6109(a)(2) 00:01:28
- IRC Section 6045 00 00:38:49, 01:07:30
- IRC Section 70433 00:38:52
- Levy 01:07:36
- Liability 00:08:32, 01:03:59, 01:12:53
- Limited Liability Company (LLC)01:09:30
- Punitive Damages 00:55:5, 01:02:09, 01:04:10
- Reasonable Cause 00:06:29, 01:35:36
- Sole Proprietor 01:09:26
- Tax Exempt Organization Search Tool 00:07:16
- Tax Gap 00:03:17
- TIN 00:21:42, 01:09:12
- TIN Match Program 00:07:28
- Transaction 00:13:37, 00:34:39, 01:05:48, 01:09:21, 01:14:56, 01:24:03
- Transmitter Control Code (TCC) 00:17:39, 00:19:04
- Vendor 00:07:48, 00:28:58, 00:40:38, 01:25:26
Artificial Intelligence (AI): Artificial intelligence is intelligence demonstrated by machines, as opposed to the natural intelligence displayed by humans or animals.
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)
Compensatory Damages: A sum of money awarded in a civil action by a court to indemnify a person for the particular loss, detriment, or injury suffered as a result of the unlawful conduct of another. Compensatory damages provide a plaintiff with the monetary amount necessary to replace what was lost, and nothing more.
Contract: A written or spoken agreement, especially one concerning employment, sales, or tenancy, that is intended to be enforceable by law.
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)
Due Diligence: Due diligence is a process or effort to collect and analyze information before making a decision or conducting a transaction so a party is not held legally liable for any loss or damage. The term applies to many situations but most notably to business transactions.
Exempt : Exempt employee is a term that refers to a category of employees set out in the Fair Labor Standards Act. They do not receive overtime pay, nor do they qualify for the minimum wage
Expense: Offset (an item of expenditure) as an expense against taxable income.
Expense Reimbursement: Expense reimbursement is a method for paying employees back when they spend their own money on business-related expenses. These expenses generally occur when an employee is traveling for business but can occur in other work-related situations. (www.thebalancecareers.com)
FIRE - File Information Returns Electronically: The IRS FIRE system is the electronic network used to accept and process most types of filing forms. Technically, it stands for File Information Returns Electronically.
Federal Insurance Contributions Act (FICA): The Federal Insurance Contributions Act is a United States federal payroll contribution directed towards both employees and employers to fund Social Security and Medicare—federal programs that provide benefits for retirees, people with disabilities, and children of deceased workers.
Form 1099: Form 1099 is one of several IRS tax forms used in the United States to prepare and file an information return to report various types of income other than wages, salaries, and tips (for which Form W-2 is used instead). - Wikipedia (https://en.wikipedia.org/)
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-MISC: The Form 1099-MISC is an Internal Revenue Service (IRS) tax return document used to report miscellaneous payments 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 W2-G: File this form to report gambling winnings and any federal income tax withheld on those winnings. The requirements for reporting and withholding depend on: the type of gambling, the amount of the gambling winnings, and. generally the ratio of the winnings to the wager.
Garnishment: A legal summons or warning concerning the attachment of property to satisfy a debt
Gross Proceeds Payment: When a business sells an asset, whether tangible or intangible, it receives a payment, which is the gross proceeds. The amount includes the costs of production and other costs and expenses related to the transaction.
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.
IRC Section 70433: An "IRC Section 70433" refers to a provision within the U.S. tax code related to recent changes for reporting payments made on Forms 1099-MISC and 1099-NEC. The section is not part of the current official Internal Revenue Code but was enacted as part of a recent piece of legislation, the "One Big Beautiful Bill Act" (OBBBA). Specifically, Section 70433 does the following: Increases the reporting threshold, adds inflation adjustments, and affects backup withholding.
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/)
Information Returns Intake System (IRIS): The Information Returns Intake System (IRIS) Taxpayer Portal is a system that provides a no cost online. method for taxpayers to electronically file Form 1099 series. The Taxpayer Portal allows you to enter. data to create Forms 1099 by either keying in the information or uploading a .csv file.
Levy: A tax levy, under United States Federal law, is an administrative action by the Internal Revenue Service under statutory authority, generally without going to court, to seize property to satisfy a tax liability. The levy "includes the power of distraint and seizure by any means".
Liability: In financial accounting, a liability is defined as the future sacrifices of economic benefits that the entity is obliged to make to other entities as a result of past transactions or other past events, the settlement of which may result in the transfer or use of assets, provision of services or other yielding of economic benefits in the future.
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.
Punitive Damages: Punitive damages, or exemplary damages, are damages assessed in order to punish the defendant for outrageous conduct and/or to reform or deter the defendant and others from engaging in conduct similar to that which formed the basis of the lawsuit.
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.
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.
Transaction: In QuickBooks, a transaction type identifies what kind of transaction occurred, such as a customer transaction, bill payment or a bank transfer. When you submit a transaction, you type in a transaction code to represent it.
Transmitter Control Code (TCC): The Transmitter Control Code (TCC) is an identifier that the IRS uses to distinguish different electronic filing companies. It's necessary when you need to file for a correction. Getting a TCC depends on how you file your 1099 forms
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.
