If your trade or business makes payments to contractors or vendors, it is very likely that you will be required to file Form 1099s. The following are a list of general rules to keep in mind:
- A 1099 is only necessary if the total payments for the year are $600 or more
- In general, corporations do not need to receive a 1099. However, Payments for legal and medical services are reported on 1099s whether or not the entity is incorporated.
- When using a SSN to report, the 1099 must start with the person’s name. When using an FEIN, the 1099 must start with the entity name. It’s okay to have additional names on the second line of the 1099, however, the first line must match the ID number.