In view of the increased p&I for not issuing 1099's, am I still safe for tp who rents out single family house and provides no services still exempt from issuing these forms to the repair, electricians, plumbing and any other service provider?
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Just bumping back up so it doesn't get lost. I think I have found the answer of that of being no. -
Unfortunately, there isn't a clear answer.
A 1099 is required if it is a "trade or business". The problem is that "trade or business" is not defined. In many cases (probably most cases), rental property is not a "trade or business" However, in some Tax Court cases it has been ruled that some rental properties have risen to the level of a "trade or business".
With that being said, I think most tax preparers don't file 1099s for clients with rental properties.Comment
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Just got back, and the question was addressed about the question at the top of the form, "Have you issued all required 1099s?
The interpretation from the presenter was that if a Sch E was not a "trade or business" then a 1099 would not be required.
He went to say that a rental would not be a trade or business unless the owner was a real estate professional. Therefore in most cases a 1099 would not be required and the appropriate answer to the question would be "yes."Comment
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the 1099 is not required for rentals unless you are an RE Pro. However, that rule is still being debated and may change. I issue 1099's anyway for rentals because it insures that the servicers I hire to do work on the rental are paying taxes on the income.Believe nothing you have not personally researched and verified.Comment
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