1099s for Rent

[Snaggletooth]

General understanding is that rent for realty (land, buildings) requires a 1099-MISC from the payer to the owner. It is important to this question that typically the renter of non-realty (e.g. equipment) does NOT issue a 1099-MISC for equipment.

Miss Scarlett rents large space from landowner and issues the owner a 1099-MISC every year. There are six chairs (workstations) in the building. Miss Scarlett uses one station and collects "chair rent" from five other hairdressers.

Do the other hairdressers give Miss Scarlett a 1099-MISC for their "chair rent?"

[joanmcq]

If they are independent contractors, yes they do. Employees, no.

[Gretel]

I agree, it does not matter if rent is to landlord or for equipment. If paid by a biz 1099's are due.

[Corduroy Frog]

Non-Realty

I have not been issuing 1099-MISC unless the rent was for real property. Am I wrong?

[newbie]

"all types of rents"

According to the instructions:

http://www.irs.gov/instructions/i1099msc/ar02.html#d0e678

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.

Coin-operated amusements.
If an arrangement between an owner of coin-operated amusements and an owner of a business establishment where the amusements are placed is a lease of the amusements or the amusement space, the owner of the amusements or the owner of the space, whoever makes the payments, must report the lease payments in box 1 of Form 1099-MISC if the payments total at least $600. However, if the arrangement is a joint venture, the joint venture must file a Form 1065, U.S. Return of Partnership Income, and provide each partner with the information necessary to report the partner's share of the taxable income. Coin-operated amusements include video games, pinball machines, jukeboxes, pool tables, slot machines, and other machines and gaming devices operated by coins or tokens inserted into the machines by individual users. For more information, see Rev. Rul. 92-49, 1992-1 C.B. 433.

[RitaB]

Note that this is an old thread

I was doing some looking on 1099-Misc prep and found this, thank you all very much.

I have a Sch C filer, rents equipment AND also pays a % of gross sales to equipment owner.

I know that the rent paid belongs in Box 1. I THINK the commission paid belongs in Box 3. Is that correct?

Or, is the commission seen as additional rent?