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Health & Fitness

Check Those 1099s

Now is the time you will start receiving year-end informational tax forms. We’re all fairly familiar with W-2s from our employer, but you will also probably receive a number of different 1099s. Make your tax filing experience smooth this year by staying on top of these informational tax returns. Here are some tips.

  • Know the different types of 1099s. The most common 1099s that taxpayers receive are:
    • 1099 INT: for interest received
    • 1099 DIV: for dividends received
    • 1099 B: for brokerage transactions (selling stocks and mutual funds)
    • 1099 R: for annuity, retirement, and pension income
    • 1099 MISC: for miscellaneous income
    • 1099 K: for merchant card activity
    • Make a list. Review last year’s list of informational tax forms and create a checklist of them. Add to that list any new forms you might expect to receive. Mark them off your list as you receive them.
    • Check for accuracy. Review each of the informational tax forms for accuracy. Is the income, interest, annuity or other income correctly reported? If cost is reported on the 1099 B, is it the correct amount? Make sure your name and your tax ID (Social Security Number) are also correct.
    • Take corrective action. If you have not received your information return by the mid February, contact the issuing organization. Also call and start the process to correct any errors you find. Make sure you follow up any correction request in writing.
    • Conduct withholding verification. If the supplier withheld any tax on this activity ensure it is noted as well.
    • Understand those 1099 Ks. This is the new kid on the 1099 block and was introduced to try to capture sales activity from places like e-bay and Amazon. If you receive one of these, please pay special attention to the information being reported to you and the IRS. These forms are complicated and track payment processing transactions. If not properly understood, you could inadvertently double book income on your business activity.
    If you have any questions please ask.



    Posted by:

    Froley Tax Services
    24672 San Juan Avenue Suite 103
    Dana Point, CA 92629
    Phone: (949) 489-2088
    Fax: (949) 266-9931
    www.froleytax.com
    craig@froleytax.com

    This publication provides summary information regarding the subject matter at time of publishing. Please call with any questions on how this information may impact your situation. This material may not be published, rewritten or redistributed without permission, except as noted here. This publication includes, or may include, links to third party internet web sites controlled and maintained by others. When accessing these links the user leaves this publication. These links are included solely for the convenience of users and their presence does not constitute any endorsement of the Websites linked or referred to nor does Froley Tax Services have any control over, or responsibility for, the content of any such Websites. All rights reserved.

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