questions on what qualifies for box 7? when a product is purchased with the service, do you send a 1099? farmers buy a cow feeder from a manufacturer who makes them, are you paying for a service, (the making of the feeder)? Fertilizer is spread on a field, (not from a corp), is that a service? You pay for the fertilizer and spreading in one amount.
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Doesn't matter. If the payment is made to an individual, in the course of a business, and is $600+, a 1099-MISC should be filed. The filing of a 1099 has no bearing on how the payor treats the payment. If it was for a tractor, for example, the tractor will probably be capitalized and depreciated. A payment for fertilizer as you described might be treated by the payer as all labor, all fertilizer, or split between the two. The 1099 filing requirements are independent of the payer's accounting.Roland Slugg
"I do what I can." -
Corporation?
Payments to corporations do not result in the filing of a 1099 Form. I would think a company making farm equipment would be incorporated.Comment
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There are small individuals (sole prop) who make feeders, hay rings, tractor buckets who are not incorporated. sometimes the labor is stated, but other times just a price for a product. Manure and litter are sold as fertilizer off poultry and hog farms to other farmers. If you go and get your manure, you would only pay for the product. if it is delivered and spread on your fields, there is a service for spreading. Many don't itemized, isn't it better to send to send for full amount.Comment
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It sounds to me like the feeder is purchasing a good, not a service and does not need a 1099. Spreading fertilizer is a service and would need a 1099. I always include the full amount even if it is a combo of good and service.Originally posted by JenMO View PostComment
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I have an independent contractor with a landscaping business who bills for his work including landscaping plants he purchases and plants for customers. These are all commercial customers and they give him a 1099 for the full amount billed. He then deducts his cost for the plants on his Schedule C.Comment
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I'm still in doubt about how much to report when some payments have been made via debit/credit card and will be reported on a 1099-K, and some payments have been made via cash or check. I can't find guidance on the IRS on what amounts to report when payments are split like this. Any thoughts?Comment
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I am a little confused about which party you are referring to. 1099-K's are issued by the credit card company that transfers payments from customers to the owner of a business, and are reported as income by that owner. The owner also reports all other income which is not paid by credit card, for which he may get a 1099-MISC or not, depending on the payor and the amount. All of these are shown as gross sales on the appropriate return, Schedule C. If the actual gross income equals or exceeds these reporting documents, then he is okay.Comment
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If you're reporting for your client who made payments by check/cash and payments by CC, then you report the payments by check/cash on Forms 1099-MISC. The CC company will report what he charged to his vendors on Forms 1099-K.Comment
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Sorry, I was a bit unclear. I was referring to payments made by my clients. Thanks, Lion, for your input. Curious if others are of the same opinion as Lion.Originally posted by Burke View PostComment
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It's not my opinion. It's from the Instructions:
Form 1099-K. Payments made with a credit card or
payment card and certain other types of payments, including
third-party network transactions, must be reported on Form
1099-K by the payment settlement entity under section
6050W and are not subject to reporting on Form 1099-MISC.
See the separate Instructions for Form 1099-K.Comment
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1099-k
Does that mean if you only pay with debit card for all your business transition, then you don't have to issue 1099-misc at all?Comment
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1099-k
Does that mean if you only pay with debit card for all your business transition, then you don't have to issue 1099-misc at all?
Also page 5-8 of the taxbook: exceptions: pyments for merchandise, telegrams, telephone, freight, STORAGE
My client paid a storage unit for storing inventory, and paid with check, does he have to issue 1099-misc?Comment
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