Monday, January 31, 2011

Dentist Has Questions about Who to Send 1099s to.

I know you have to give independent contractors 1099's when you pay them over $600 in a year. However, I cannot find a solid definition of what an independent contractor is. I know a corporation is not an independent contractor and does not require a 1099. What about LLC's (single member disregarded entities and those taxed as corporations)? Are we supposed to look up which entities are which types to determine whether they will get a 1099? It's not always easy to tell if Joe's Plumbing Service is a corporation, LLC, sole proprietor, etc. The dental lab I use is an LLC but I don't know if they are to be considered an independent contractor or not. How many of you send 1099's to your small dental labs?

You may want to read thru these links:

http://www.irs.gov/efile/article/0,,id=98114,00.html

http://www.irs.gov/instructions/i1099gi/index.html

http://www.irs.gov/pub/irs-pdf/i1099msc.pdf

Send your questions to Andrew Rose arose@dentalcpas.com  

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