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Giving 1099 to server provider? apparently Ive been doing it wrong!

Discussion in 'Business & Tax Advice' started by mandude, Jul 8, 2015.

  1. mandude

    mandude Jr. VIP Jr. VIP Premium Member

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    Ok I had to ask a tax expert but their answers dont seem to make sense to me. They are saying that if I pay a service provider and its over $600 in a year, I basically have to give them a 1099, and then they also file a 1099 (but we know that part).
    But that makes it sound like every service I ever bought (such as here on BHW) I am supposed to send them a 1099? I used a few link building services here that cost more than $600 per year. I have to send them a 1099? I dont even know where these people are located and they are over seas (I am USA).
    what are the rules on having to give 1099 out.. Whether the payer is a company (or person), and whether person getting funds is single person or company.

    thanks
     
  2. mandude

    mandude Jr. VIP Jr. VIP Premium Member

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    ANYBODY?
    text too short
     
  3. BassTrackerBoats

    BassTrackerBoats Super Moderator Staff Member Moderator Jr. VIP

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    I'm pretty sure the IRS code is that you have to do the 1099 thing with a provider but I have never done it and I've been audited with no issues relative to that. I'm not saying you do not have to do it, I am saying that the practicality of it is a bit extreme and that the friendly old IRS guy that came knocking on my door (and he did indeed come and visit with no warning) was satisfied with my records.

    I do keep records of the purchases via invoices and paid receipts and that includes PP stuff as you need to maintain them properly. Not having them leaves you open to all manner of probing that can make it hard for you to sit for weeks.

    I have actually seen pictures of a guy that says he is a big time IMer gathering all his records, as they were not cataloged and filed properly, to take to his tax man and I think it was like 4 or 6 months of stuff... don't do that either as that can lead to losing things, improperly coding them to the right job/expense, and cause you to lose something of real value in your paperwork.

    It can also hurt you when it comes to paying taxes as without the proper documentation on hand, you are not supposed to deduct an expense.

    For about 75 - 100 a month you can hire a bookkeeper in your local area to keep things organized and that organization goes a long way with the IRS should you have to deal with them in any face to face meetings.
     
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  4. asap1

    asap1 BANNED BANNED

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    Shit this reminds me I need to start keeping track of this stuff better.

    Thanks for the info BTB