Freelance?--stock up on 1099's

[Tom Taggart]

Many of us get 1099's every January--maybe you do some voice work on the side, or play-by-play. Maybe you do record hops--not likely that you'll get a 1099 then, but if you do a gig for a big enough company, you might. You are not a regular employee, but that company has to report what they've paid you over the year, so they send you and the IRS a 1099. OK, fine.

The idiots in Congress strike again, in their attempt to destroy all forms of private enterprise. Buried in the health Obamation is "Section 9006,"--which expands the role of the 1099.

Beginning January 1, 2012, EVERY business that spends more $600 a year for a service or for goods MUST send a 1099 to that company--not just to individuals. Of course, the sheeple will not figure this out until tax time 2013--well after the election. Then watch the mad scramble.

List your DJ business as income? Buy a new amp & speakers at Musician's Friend for $629.95? Come tax time 2013 you need to send them a 1099. Have a rental & buy a new refrigerator & paint at Lowe's? You must send them a 1099.

For those of us who own full-time businesses this will be a nightmare. Remember for every 1099 you send there must be a SS# or TIN (Tax ID number). Sooooo....now I'll need to get TIN's from:

The electric company; the phone company; the gas company; ASCAP/BMI/SESAC; The water district; the car dealer who fixes the company car; Sam's Club (paper towels & T.P.); Office Depot; the restaurant where we have the Christmas party; DC counsel;..hmmm, is the regulatory fee a "service?--nah, just extortion; let's see, who else, ohh, the gas trade; insurance agent; BSW (new equipment); RCS-Selector; Dial Global & Fox News (we're barter--but that probably counts anyway); Katz;--then if we get into trades there's Kennywood, Cedar Point, Columbus Z00, and a host of others.

The point of all this nonsense is to pave the way for a value-added tax. In the end, this will help kill a host of small businesses, or drive them underground.

Welcome to Italy.

We need another revolution.

[genlock]

This would not be the hope part of "Hope and Change".

[lastone]

No, it's both. They "hope" it's noticed since it's a "change".

I know there must be more of this stuff in there and I still say the public does not know what's in this bill that is now LAW. Your next vote should be for whom ever will "fix" the "errors" in this bill. Whatever party they're with.

[Bob Campbell]

Just read the section of the bill being discussed, section 9006.
Looks to me that all it does it make it harder to claim mythical business expenses as deductions.
It does force you to keep better records of business expenses.
So, how many 1099's a year will you have to fill out? And how hard could that be? About 6 lines to fill in.
Must be awful to make it harder to cheat on taxes huh?

[Tom Taggart]

Bob--you are a typical wage slave sheeple.

1. Every trade arrangement over $600 will require a 1099--as a practical matter these will go away because it will become too much hassle for advertisers.. We use concert tickets, circus tickets, amusement park tickets, etc., to perk advertisers. Hate to burst your liberal bubble, but this is the way business has to be done. BTW, at my stations, that's also the free pop and bottled water in the fridge...

2.Since you obviously don't pay the bills, you don't understand how many bills that must be paid to keep the doors open and DJ's employed....you can be replaced with a computer you know, that's just three more 1099's (one for where we get the computer, one for the software company, one for the sound card...).

3. If this was just a matter of sending these out, it might be simple. But first we need to get the TIN's (Taxpayer ID's) from every company involved. Then add up everything we spent with everybody. More money on the accountants--hmmm, why do we need any DJ's? See my PARTIAL list above. You want to try to get TIN's (Taxpayer ID's) from all those companies?

4. It's a stalking horse for the VAT. The WalMarts and Krogers of the world will just raise prices. We have a hard enough time just keeping the rates from being discounted further. So the money comes off of what is left at the bottom line.

[cgarison]

3. If this was just a matter of sending these out, it might be simple. But first we need to get the TIN's (Taxpayer ID's) from every company involved. Then add up everything we spent with everybody. More money on the accountants--hmmm, why do we need any DJ's? See my PARTIAL list above. You want to try to get TIN's (Taxpayer ID's) from all those companies?

Where I work, we already request this inforamtion, but can you imagine the scope of the project that it i going to take to make sure that all of the records are in place for a Fortune 1000 company. That will be at least an FTE in Rent Disbursement, Real Estate, Domestic, and International payables plus 2 FTEs for Expense Disbursements and an additional two for Construction/facilities. What a crock of crap.

But, how off shored positions in major corporations will now need an American counterpart to assist the resource in India??? Double the reporting work load on business and mandate interaction among companies and you have a return of jobs to the economy and a way to bolster a postal service that is struggling due to the electronic delivery of all things from pay checks to power bills.


I see big, big project in the pipes for my team at work and a few more years of work before I can have an Indian counterpart trained to do what I do best, think like an American.

[cgarison]

BTW.... This new 1099 regulation is going to make life a breeze for all of those state use tax auditors.

For the vast majority of auditors, this will simplify their job to looking at a 1099 register and then comparing it to the list of direct pay use tax permits and sales tax exemption certificates. State governments are going to love this legislation.

[Big Media]

3. If this was just a matter of sending these out, it might be simple. But first we need to get the TIN's (Taxpayer ID's) from every company involved.

I wouldn't be all that concerned about requesting TINs from your vendors. It is very common practice and most vendors have W9 forms already filled out. All they do is sign it and fax it. The vendors understand that this is what must be done to sell products and services business-to-business.

If anyone gives you any flack, make sure they understand that they will not receive payment until the completed W9 is returned.

I have been doing this for 10 years and I have never had a business or an individual refuse to provide a W9. Also, the $600 cap doesn't apply to me. I have to have a W9 from EVERY vendor before we will issue a check---even it if is for $1.

[Bob Campbell]

I've never found a company for which I've done free lance that DIDN'T send me a 1099. I always fill out a W-9 for them. It's about a 15 second process.
1000 per year works out to about 3 extra hours work. Per year. Wow.

[Tom Taggart]

Yes, but they already have your SS# & keep track of what they are paying you. We have 10 people on salary for three stations, (including part-timers with regular shifts) plus another four who get 1099's (voice talent and sports). Not difficult to keep track of.

It will be all of the other companies we buy from. If it is so easy to get TIN's let's see someone go down to Lowes, buy $10 in hardware, and ask for a TIN. Or better yet, the local hardware emporium.

Another point I hadn't thought of--companies that buy stuff from overseas--the foreign companies won't have TIN's (usually)--not exactly a problem for radio stations, I would agree.

[Bob Campbell]

Yes, but they already have your SS# & keep track of what they are paying you. We have 10 people on salary for three stations, (including part-timers with regular shifts) plus another four who get 1099's (voice talent and sports). Not difficult to keep track of.

It will be all of the other companies we buy from. If it is so easy to get TIN's let's see someone go down to Lowes, buy $10 in hardware, and ask for a TIN. Or better yet, the local hardware emporium.

Another point I hadn't thought of--companies that buy stuff from overseas--the foreign companies won't have TIN's (usually)--not exactly a problem for radio stations, I would agree.

I think you may be misunderstanding the law. You don't need to 1099 a 10 dollar purchase, only transactions over 600, that's per transaction, not annual total.

[Tom Taggart]

So you list $1500 in office supplies--watch for some anal IRS type to ask where the 1099's are!

[cgarison]

I think you may be misunderstanding the law. You don't need to 1099 a 10 dollar purchase, only transactions over 600, that's per transaction, not annual total.

Actually, it will be for total spend more than $600.00 with any given vendor. So if you place 12 orders of office supplies a year with Staples and each one is over $50.00, then you owe Staples a 1099.

For companies that are the size of those in the Fortune 1000 list, this will mean a total re-work of how accounts payables is processed . From what I am hearing, this is the big topic of discussion at most of the breakout sessions during the Internatioanal Association of Payables Professionals conference that is taking place this week. What we have discussed in this thread seems to just barely scratch the surface of the impact this law is going to have.

Between the ARRA last year and Healthcare Reform this year, we are looking at IT projects on the scope of what took place with Y2K in 1998 and 1999.

[Bob Campbell]

I think you may be misunderstanding the law. You don't need to 1099 a 10 dollar purchase, only transactions over 600, that's per transaction, not annual total.

Actually, it will be for total spend more than $600.00 with any given vendor. So if you place 12 orders of office supplies a year with Staples and each one is over $50.00, then you owe Staples a 1099.

For companies that are the size of those in the Fortune 1000 list, this will mean a total re-work of how accounts payables is processed . From what I am hearing, this is the big topic of discussion at most of the breakout sessions during the Internatioanal Association of Payables Professionals conference that is taking place this week. What we have discussed in this thread seems to just barely scratch the surface of the impact this law is going to have.

Between the ARRA last year and Healthcare Reform this year, we are looking at IT projects on the scope of what took place with Y2K in 1998 and 1999.

That's now how I read it. I could be wrong. Either way it's just like keeping receipts. Many people complain about tax loopholes. They shout to close them, not create other taxes. This closes a loophole. New paper work is minimal. If you're reading is correct, it's still only one 1099 per vendor per year. Actually that's less paperwork than if my reading is correct, which would be one 1099 per 600 dollar or more transaction.