In light of the new regulations for rental owners I was wondering whether a 1099 would be required to be filed for rents paid by the rental owner. Specifficaly if the taxpayer owns a house trailer that he rents out and pays for the lot rent where the trailer is located does he have to file a 1099 for the payment of lot rent to the trailer park owner.
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Assuming the rental is not on a transient basis, then not required for 2010. -
1099
How about going forward into later years. Since rentals are now considered the same as a business so far as a 1099 does this mean that the 1099 would be required in future. Everything I read says that 1099 is required for services provided - would the lot rental be considered a service.Comment
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From PL 111-240 Section 2001:Originally posted by Earl View Post
From ยง6041...a person receiving rental income from real estate shall be considered to be engaged
in a trade or business of renting property.
(a) Payments of $600 or more
All persons engaged in a trade or business and making payment in the course of such trade or business to another person, of rent...Comment
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It doesn't go into effect until 2012. By that time I suspect it will be revoked by congress. I have chosen not to confuse my clients with the details until congress makes a final decision on this issue. The dems snuck it into the healthcare reform that no one in congress read. With the big stink that has been made about it, it now appears that it will be revoked before it goes into action.
I am also waiting to see what will be done with the Bush tax cuts. No sense in dealing with any of this until we know for sure what the laws end up being.
I have filed extensions for any returns that are affected in the hope that congress gets their act together before the extensions expire.Believe nothing you have not personally researched and verified.Comment
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You need to read the laws. This discussion pertains to PL 111-240 which is effective beginning in 2011.Originally posted by taxea View Post
The one you are referencing is PL 111-148.Comment
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I'm sending letters to all my rental owner clients explaining this and enclosing form W-9. I'm thinking of charging $10 per 1099 and including the 1096.Comment
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1099 Home Office
Further on 1099 thread. If you are renting a residence in which you have a home office what would be included on Form 1099's for rent. Would you breakdown the rent to home office and just include that amount on 1099 or would you put the whole amount paid in rent on the 1099. Also would apply to any repairs, etc over $600 dollars. Would you just use the home office portion of repairs, etc. to determine if you are over the $600 dollar amount or would the total amount paid be used. Fun ain't it.Comment
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rent paid?
maybe i'm not getting this, but would someone paying rent be sending 1099 to landlord? i'm thinking that we need to get clarification about who is issueing the 1099Comment
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The clarification is the law itself - see PL 111-240.Originally posted by taxmom34 View PostComment
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Don't feel bad, I'm not getting it or not understanding what the bid deal is. If you are a business paying rents to someone isn't a 1099 required to be issued under current law (box 1)?Originally posted by taxmom34 View Post
The new law will require landlords to report on a 1099Misc services that they paid $600+, such as a contractor for repairs/improvements, lawn maint., snow removal and such?
An owner of rental properties will now be considered just as a business would.Comment
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1099
If you operate a tax preparation business and renting an office, do you issue a 1099 to your landlord?Originally posted by newbie View PostComment
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I issue one to my landlord as well as prepare them for my clients who pay rent to a landlord.Originally posted by taxxcpa View Post
Edit: To clarify I prepare them for my business clients who pay rent for business property whether it be real or personal property.
Box 1. Rents
Enter amounts of $600 or more for all types of rents, such as real estate rentals paid for office space (unless paid to a real estate agent), machine rentals (for example, renting a bulldozer to level your parking lot), and pasture rentals (for example, farmers paying for the use of grazing land). If the machine rental is part of a contract that includes both the use of the machine and the operator, the rental should be prorated between the rent of the machine (reported in box 1) and the operator's charge (reported as nonemployee compensation in box 7).
Public housing agencies must report in box 1 rental assistance payments made to owners of housing projects. See Rev. Rul. 88-53, 1988-1 C.B. 384.Last edited by Jesse; 11-30-2010, 11:48 AM.Comment
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Yes, don't you? As a tenant my 2011 rules don't change. As a landlord I will be "considered to be engaged in a trade or business of renting property" like Solomon said. In those regards I don't see what the big deal is I don't think most landlords will have a ton of 1099's.Originally posted by taxxcpa View Post
As for the 2012 regulations I'm betting they'll be tweaked.Comment
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Rental Prop Owners
The 1099 reporting for Owners of Rental Property paying $ 600 or more in services, i.e. plumbers, painters, handymen, etc, does not take effect for payments made until after Dec 31, 2010, correct???
Thereby if in effect after Dec 31, 2010, it will be Form 1099 reporting for 2011 issued in January 2012, correct?
sorry I am having "issues" keeping track of all of these various dates, and categorizing in my brain and timetables.
If the above is correct, then as someone else pointed out, W-9 forms are going to be "flying" around trying to acquire the much needed information for year 2011 which is just around the corner.
Guess a lot of "service" people will not be working, or the owner's will not be deducting the expense for year 2011...
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