1099 Best Practices: What You Need to Know Before You Pay That Vendor
Running a business, managing rental properties, or self-employed? Then you’ve probably heard of the 1099—and if your palms get a little sweaty thinking about year-end paperwork, don’t worry. We’re breaking it down in plain English, with a few tips to make your January a whole lot easier.
What’s a 1099, Anyway?
A 1099-NEC is a tax form used to report payments made to individuals or businesses not on your payroll—typically $600 or more during the calendar year. If you’re hiring vendors, contractors, or service providers as part of your business, you may be responsible for sending them one.
This applies whether you:
Run a small business
Are self-employed or freelancing
Own rental properties and hire out maintenance work
The Golden Rule: Get a W-9 Before You Pay
One of the biggest (and most common) 1099 headaches we see? Trying to track down a W-9 at the end of the year.
Here’s how to avoid that mess: Ask for a W-9 before you make a single payment.
A W-9 gives us everything we need to determine whether a 1099 is required: legal name, business type, taxpayer ID, and address.
And the good news? You don’t need a new one every year (unless your information changes).
What We’ll Need From You
When January rolls around, just send us:
The vendor’s W-9
A record of how much you paid them during the calendar year
Once we have those two pieces, we’ll handle the rest—getting your 1099s postmarked to recipients by January 31 and submitted to the IRS on time.
(Not sure how to track payments or request a W-9? We’re happy to help—this is exactly what we do at Personal Financial Services!)
Final Thoughts
Sending 1099s doesn’t have to be stressful—the key is being proactive. A little planning ahead means no last-minute W-9 scramble or IRS panic.
And remember:
1099 are due to recipients by January 31
Work with PFS and we’ll file them directly with the IRS for you
Got questions or want help organizing your 1099s this year? Contact our team—we’re here to make your tax time easier!
