The question might seem simple, but this basic form can sometimes be confused or even overlooked, leading to penalties and even the threat of jail time. Staying organized and keeping up with your 1099 tax forms as a contractor is essential to your business’ well being. When you are a contractor, your life blood is carved into these 1099 tax forms which you will receive on a yearly basis.
For the most part, transcribing fully these 1099 forms on your tax returns is the essence of showing what your yearly taxable earnings are for the tax year. You ned to be able to show exactly what you made and the 1099 form is at the core of that.
But what if you don’t get a 1099 tax form? Is it then ok to not report that on your tax returns?
Nope, you have to report all income. This is where some people get confused: If a payee pays you less than $600 for the year, they are not required to send you a 1099 earnings document. But, that doesn’t mean you aren’t supposed to report the earnings. you still need to report what you earned, even if its as little as $10. All earning are taxable, so report everything, whether or not you receive a 1099 or not. You never want to be caught with your pants down with the IRS, they can make your life a living hell.
What if you don’t receive a 1099 on time?
The IRS recommends contacting them at 800-829-1040 and they can get you set up with a substitute form. Just don’t do nothing, you need to file, 1099 or not.