need to issue 1099-misc?

[oceanlovin'ea]

Client has spinal injury and has to have help with daily activities. State reimburses him for these costs through a program.

His wife is trained and she is the person that helps him with his daily activities. he pays her and is reimbursed by the state.

He wondered if he needed to issue a 1099 to his wife for what he pays her. Do you think he should?

Linda, EA

[AJsTax]

No

they are not involved in a trade or business. She would not qualify for Sch H, she is exempt from that. should not be any filing between spouses in this case.

[oceanlovin'ea]

Schedule C

I had planned to put this on a schedule C as self employed income. She is an occupational therapist by profession. Being trained in this, allows him to hire her to help with daily activities and not a stranger to come into their home for these duties.

They knew this is how it would be done and she would have to pay SE tax on her earnings.

Linda, EA

[AJsTax]

In that case

Still no 1099. You would not issue one to an outside service coming in. He is not in a trade or business. He can not issue 1099-misc.
The company making the payments may issue on to somebody.