Information returns are also known as 1099 tax designations. They are collected by the IRS to track the revenues that are paid to individuals. Filling them out is quite simple.
Basically, this form is where you can track your revenues paid to another person for the requested tax year. For example, you would have to issue a 1099-MISC of $1,200 per year for getting the services of a lawn mower at $100 per month. This way, IRS keeps track of the revenues reported by the gardener.
First of, you have to know the proper form in filling up a tax designation. There are various types of 1099 forms and when filling out, be sure to have the MISC version. There are printable versions of this form in the internet but none of them will be honored. The forms will later be scanned through special IRS computers so you really need to get the official copy. The official copies are distributed in big libraries, major post and IRS offices. To make sure you didn’t get the wrong copy, you to the nearest IRS Office to ask some. Another hassle-way free of getting a copy is ordering one online from the IRS website.
Preparing the form is way easier than you think it is. Start by printing a copy of the form with your printer so you can just throw it away if you make a mistake. Moreover, you may have to provide a total for the payments you made to a person. Then, tally how much you have paid for someone.
Write your name on the top left box of the form. Then you have to fill up your general information including your name/business name, phone number, email address and address. Write your tax identification number next in one digit per box. Repeat the same for the right box that asks for another tax identification number but this time, write the tax identification number of the one you are issuing the form for. Then, write the address of that person at the bottom of the two boxes together with his name.
The next thing you do is enter the total amount in dollars. Some are required to fill up the boxes in the middle of the form but you can leave it blank if you don’t have to. The box that appears first is the “1 Rents” field. If you are reporting for a paid rental, you may write it here. For a basic fee paid to someone for his services, put your annual report on box 7. This one is for the “nonemployee compensation.” Use this field if you don’t know that classification of your report as this is the mostly used field.
And viola! You have just filled out your 1099-MISC form. The very last step is to get another hard copy of the form and the cover sheet as well numbered 1069 and you’re good to go.