Reporting 1099-Misc for IC payments

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Loon11
Posts: 423
Joined: Wed Feb 29, 2012 5:07 pm

Reporting 1099-Misc for IC payments

Post by Loon11 »

Question for the bogleheads that understand taxes!
I paid my contractor a total of 103500 for a major renovation for a rental property. When gathering my records to send him a 1099-Misc I realized that the first payment of $50K was actually paid to him in Dec. 2012 with subsequent payments totalling the $103500.
My question is do I subtract the $50K from the total paid in 2013?
I want him to have to pay taxes on every penny - he was really a nightmare contractor! Thanks for any help.
IRS doesn't answer questions anymore. Thanks!
pshonore
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Joined: Sun Jun 28, 2009 2:21 pm

Re: Reporting 1099-Misc for IC payments

Post by pshonore »

Sure sounds like you should make the 1099 for the difference (about 53K). While he has to account for that, he probably will not pay taxes on much; he probably has labor costs, materials, normal business expenses (insurance, travel, tools, etc, etc.)
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PaddyMac
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Re: Reporting 1099-Misc for IC payments

Post by PaddyMac »

Sounds like you should have given him a 1099 last year for the first payment. The current one should only be for payments made in 2013.

By the way, I used http://www.efile1099now.com/ this year and liked doing it online. Anyone else found anyone better/cheaper? I only usually have a couple to file.
Topic Author
Loon11
Posts: 423
Joined: Wed Feb 29, 2012 5:07 pm

Re: Reporting 1099-Misc for IC payments

Post by Loon11 »

Thanks - I was afraid that was the answer. I hope not doing one last year doesn't cause any problems for me. The joys of owning rental property!!
Topic Author
Loon11
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Joined: Wed Feb 29, 2012 5:07 pm

Re: Reporting 1099-Misc for IC payments

Post by Loon11 »

Thanks for the link PaddyMac - will check it out. I had called and received the forms from the IRS which I will probably use, but by hand. If the website makes it easier, will definitely use.
Topic Author
Loon11
Posts: 423
Joined: Wed Feb 29, 2012 5:07 pm

Re: Reporting 1099-Misc for IC payments

Post by Loon11 »

really looks like the efile web site will be easy - will end up costing me $8.00 but sounds like its worth it. since it has to be the original form, only way I could do it would be to hand write it and I'm hesitant to do that.
Thanks for this - believe it will save some headache. Also, I don't see why it shouldn't be deductible as a rental property expense.
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