Real Estate Blog

Landlords must now issue 1099’s to anyone that is paid more than $600.00 for services or products. Anyone is defined as small handyman to major corporations such as Wal-Mart. It is important that you carry with you IRS form W-9.

You MUST get this completed form from everyone that you pay a total of more than $600.00 in a calendar year. I strongly recommend that you get the completed W-9 before you make payment for goods or services. If anyone refuses to give you a W-9 you are required to do a 28% backup withholding. To calculate Backup withhold you take the total amount that you are suppose to pay, multiply by 28% and deduct that from their check.

You are required to send that 28% Backup Withholding to the IRS along with the person or company name, total amount that was supposed to be paid and total amount of backup withholding. At end of year (before 31 January of 2012) you are required to issue to 1099’s.

Sample 1099 http://www.irs.gov/pub/irs-pdf/f1099msc.pdf

Sample W9 http://www.irs.gov/pub/irs-pdf/fw9.pdf