1099MISC reporting

[Jesse]

Two questions:

1. If a third party is paid for towing vehicles to the mechanics shop for repairs would this be considered a service and should be reported on a 1099MISC? I say yes, anyone disagree?

2. If any service is paid some times with a check and some times with a credit card, with the new 1099K reporting will the amounts need to be separated and the 1099MISC report only the amount paid for with check?

[Uncle Sam]

Two questions:

1. If a third party is paid for towing vehicles to the mechanics shop for repairs would this be considered a service and should be reported on a 1099MISC? I say yes, anyone disagree?

2. If any service is paid some times with a check and some times with a credit card, with the new 1099K reporting will the amounts need to be separated and the 1099MISC report only the amount paid for with check?

1) Paid by whom - the vehicle owner or the AAA?

2) You have brought up a subject that I have mentioned all year long as the crux of the problem with 1099 reporting. There are so many variables that go into the credit card total, that there's no way IRS is going to match up the correct amount.
But in answer to your question - amounts paid by check should go on the 1099-MISC. Let the credit card company worry about the credit card reporting issues. So long as both items are picked up as income/expenses (whichever side you're on) with proper documentation - you're fine.

[Jesse]

Thanks

1) Paid by whom - the vehicle owner or the AAA?

The vehicle is towed to the mechanics shop, so it's paid by the Mechanic and then billed to the customer.

[Kram BergGold]

Jesse

If the tow truck company is not incorporated then a 1099-MISC would be appropriate from the mechanic to the tow truck company.

1099-K forms for 2011 are to be ignored. See the instructions for Schedule C and Schedule E. So this is a non issue for 2011 filings.

[ChEAr$]

If the tow truck company is not incorporated then a 1099-MISC would be appropriate from the mechanic to the tow truck company.

1099-K forms for 2011 are to be ignored. See the instructions for Schedule C and Schedule E. So this is a non issue for 2011 filings.

Oh? really? Does that mean we don't have to report credit card sales separately?

I was going to inform clients they could very simply rely on th e1099 k forms for the information.

[newbie]

Interesting

http://www.irs.gov/pub/irs-pdf/i1040sc.pdf

Line 1
Enter gross receipts from your trade or business. If you received merchant card and third party network payments in 2011, you should receive a Form 1099-K for those payments. These payments should have been reported to you in box 1 of Form 1099-K, Merchant Card and Third Party Network Payments. Merchant cards include, but are not limited to, Visa and MasterCard. Third party networks include, but are not limited to, PayPal and Google Checkout. For 2011, you are not required to report income received via merchant card or third party network payers, so enter zero on line 1a and report all income, regardless of how it was received, on line 1b.