1099-misc

[AccTaxMan]

Is a landlord still require to file a Form 1099-MISC for anyone who get paid by him more than $600?

If I remember correctly, the proposed requirement has already been repealed.

If that's the case, why would they still ask the question on the Schedule E "Did you make any payments in 2011 that would require you to file Form 1099-MISC?"?

[Gretel]

Yes, repealed. You are asking the wrong people as to "why". Not only is this form wrong but also some instructions and such. Will create a lot of confusion this year. Maybe more business for us?

[AccTaxMan]

Yes, repealed. You are asking the wrong people as to "why". Not only is this form wrong but also some instructions and such. Will create a lot of confusion this year. Maybe more business for us?

So does that mean the question can be ignored?

[Gretel]

I don't know if IRS has come up with "final" guidelines. Some say just ignore, some say to answer no, which I will be doing. It probably also depends on what your software lets you do to not have error messages.

[Kram BergGold]

Answer to Question

For whatever reason the IRS left the question there. For 2011 the answer to the first question is "NO".
This makes the second question irrelevant so no answer is requried.

[Gene V]

Is a landlord still require to file a Form 1099-MISC for anyone who get paid by him more than $600?

If I remember correctly, the proposed requirement has already been repealed.

If that's the case, why would they still ask the question on the Schedule E "Did you make any payments in 2011 that would require you to file Form 1099-MISC?"?

As I remember from the last IRS seminar (4 weeks ago) we do not have to issue 1099.
I would just check the box NO on Schedule E

[taxea]

Is a landlord still require to file a Form 1099-MISC for anyone who get paid by him more than $600?

If I remember correctly, the proposed requirement has already been repealed.

If that's the case, why would they still ask the question on the Schedule E "Did you make any payments in 2011 that would require you to file Form 1099-MISC?"?

For those who run the rental as a business and provide services to the renter. One that comes to mind is Vacation Rentals which are usually short-term and the landlord may provide maid services or meals, etc

[Jesse]

For those who run the rental as a business and provide services to the renter. One that comes to mind is Vacation Rentals which are usually short-term and the landlord may provide maid services or meals, etc

That would be reported on the Schedule C, not Schedule E.

[duanecpa]

1099-Misc

The same 2 questions are on 1120, 1120S, 1065, Sch C, Sch E and Sch F.

According to the TaxBook - 2011 - Page 1-11, it states the following:

'The rules that require information return reporting for payments of $600 or rmore to non-employees (independent contractors) still applies.'

Sames Section - Author's Comment:

'The repeal of the expanded 1099 reporting for rental activies is not included in the final IRS instructions for the 2011 Schedule E (Form 1040). Thus, unless the taxpayer is otherwise engaged in a trade or business activity and made payments in 2011 that require the taxpayer to file Form(s) 1099, this author will answer "No" for Question A and leave Questions B blank.'

Page 5-15 - Court Case: 'A taxpayer was a hospital employee. He also owner six rental untis held for the production of income. The IRS denied the office-in-home deduction for the rental activity as it was not a trade or business. The court allowed the deduction and noted the personal efforts of the taxpayer to manage six units in seeking new tenants, supplying furnishings, cleaning, and otherwise preparing the units for new tenants. These activities were sufficiently sytematic and continues to place the taxpayer in the business of real estate rental.'

My conclusions:

1. Taxpayers who own rental real estate - reported on Schedule E - generally have to pursue the collection of rents, managing the rental units, seeking out new tenants, etc because they generally have mortgages on the rental properties that need to be paid - therefore, there are in the trade or business of real estate rental.

2. The rules for payments that are $600 or more for non-employees still apply.

3. Normally a Schedule E taxpayer manages the rental properties, seeking new tenants, collecting rents, maintaining and improving the rental unit properties since they generally have mortages on those properties that need cash to satisfy.

4. If a Schedule E taxpayer has such payments as noted in number 2 above, then the answer to Question A is 'yes' and the answer to Question B also needs to be 'yes'.

5. If a Schedule E taxpayer does not have payments that satisfy no 2 above, then the answer to Question A is 'no' and Question B is left blank.

Does anyone see any flaw in my conclusions - would like comments if there is.

Thank you.

[Gretel]

This is of high interest to me and addresses a question I yet have to find/get a good answer to. When is rental property just rental property and when is a rental property owner deemed to be in business?

Does it depend on number of rentals? ...on involvement?...having a LLC, even just for one rental? ...single owner LLC / multi-member LLC makes a difference?

Is a real estate professional guarantied in the business of renting property?

Probably some more good questions out there.

[taxea]

That would be reported on the Schedule C, not Schedule E.

I presumed any good preparer would know that. I really don't need your help

[ChEAr$]

Involment. If services are provided along with the rental, then possibly it's a schedule c endeavor.