Forms and Associated Taxes for Independent Contractors Internal Revenue Service

Hire anywhere without worrying about local laws, complex tax systems, or managing international payroll. Comprehensive coverage for your business, property, and employees. If you are looking to outsource Paychex can help you manage HR, payroll, benefits, and more from our industry leading all-in-one solution. If this date falls on a weekend or holiday, the deadline will be moved to the next business day. The keys are to look at the entire relationship and consider the extent of the right to direct and control the worker.

  • Use e-Services for Business to manage your employer payroll tax account online.
  • To take full advantage of these benefits, however, employers must understand how to pay these individuals in accordance with payroll tax codes.
  • If your business uses the services of this type of worker, you should be familiar with independent contractor tax forms and their filing requirements.
  • The Taxpayer Portal allows you to enter data to create Forms 1099 by either keying in the information or uploading a .csv file.
  • An IC can either be a single individual, a company, or a corporation.
  • If that’s the case, you could take a crack at filing taxes yourself.

For more information see Publication 5717, IRS Portal User GuidePDF. You may continue to use the Filing Information Returns Electronically (FIRE) system to file your information returns. If you’ve made the determination that the person you’re paying is an independent contractor, the first step is to have the contractor complete Form W-9, Request for Taxpayer Identification Number and Certification. This form can be used to request the correct name and Taxpayer Identification Number, or TIN, of the payee. The W-9 should be kept in your files for four years for future reference in case of any questions from the worker or the IRS. Wondering what other independent contractor tax deductions you can claim?

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The TIN reported on the form can be the contractor’s Social Security number or an employer identification number. This tax form for independent contractors should be kept on file for four years in case questions arise from either the contractor or the IRS. HR experts can offer assistance in various ways, from payroll management to help with tax forms for independent contractors. As questions arise about the nuances of employee and independent contractor classification under other regulations and laws, an HR consultant can also be a guide.

What is a 1040?

Form 1040 is used by U.S. taxpayers to file an annual income tax return.

A TIN may be either a Social Security Number (SSN), or an Employer Identification Number (EIN). Make sure the contractor checks the box exempting him from tax withholding. As a separate Independent Contractor Tax Form Requirements business entity, the IC should file his or her own self-employment taxes. Zenefits preps and stores this document for companies that hire and pay contractors through the platform.

Form SS-8: Properly classify workers

This agreement will align all parties and might even present deal-breakers for some contractors (especially small business owners). If you need help filing an independent contractor tax form, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site.

How do I get a 1099 form?

To order official IRS information returns, which include a scannable Copy A for filing with the IRS and all other applicable copies of the form, visit

This amount is based on your total income for the year minus deductions. Instead, as a self-employed person, it’s your responsibility to set aside enough money to pay your taxes by the filing deadline. Now that you know how to prepare 1099 for an independent contractor and complete 1099-NEC, you must learn about submitting the form. If the degree of control you exert is less or the worker has a great deal of autonomy, then the worker is probably an independent contractor. Other 1099 forms are reported for individuals who earn from interest income, state tax refunds, IRA distributions, tax dividends, prize winnings, personal property sales, etc.

What Forms Do I Need to Hire Independent Contractors in the US? A Checklist

After you obtain your contractor’s consent, you can send them Copy B. Make sure you get the consent in a way that the contractor affirms receiving Copy B electronically. You will also need a Transmitter Control Code before using FIRE. Form 4419 must be submitted a minimum of 30 days before the tax deadline for Form 1099. If discrepancies are found in any 1099-NEC forms, the business owner should follow the IRS directions to refile the form as soon as possible with the “corrected” box checked. The Filing Information Returns Electronically (FIRE) system is set up for financial institutions and others to file Information Return Forms 1042-S, 1098, 1099, 5498, 8027 or W-2G. Information Returns can be filed electronically, however, you must have software that can produce the file in the proper format as required by Publication 1220.

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The due date for producing the 1099-NEC independent contractor tax form is before or on 1st February. By this date, you are required to provide each contractor and the IRS a Form 1099-NEC. E-filing is the best option here as it becomes easier to meet the provided deadline. The 1099-NEC independent contractor tax form must be provided to each contractor whom the business has paid more than $600 for their services in a year.

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