Question

Can i issue 1099-NEC as individual (I am not freelancer, LLC or any other entity) - to: freelancer, gig worker? (i paid 16,000$ service for personal use) Please, short answer: yes-i can do it. no- only business can issue 1099nec. Dont need to-but CA

Forum|Forum|2 years ago
January 8, 2024
3 replies
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TurboTax Online

short and sweet--no.

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

Z

zaebb1Author

Well, if I , individual (not LLC, not freelancer) - get freelancer to do home remodeling or graphic design (whatever job for personal use). I Pay that freelancer 16,000$ cash.

Your answer is NO, I- individual, can not issue 1099-NEC to that freelancer.

Questions:

1. If I do not issue him that 1099-NEC, how than , that freelancer will claim 16,000$ on his taxes? (I mean, he earned that money).

2, Isn't 1099-NEC was created for this reason: so IRS knows I paid cash, this much - and that person received it?

On internet there is just general answer about it: as individual that got service for personal use You DONT NEED TO ISSUE 1099-nec to freelancer....

I dont need to....but question is: CAN I ? (and nobody can give definitive answer to this)

Thanks

E

ee-ea

YOU MAY ISSUE A 1099NEC EVEN IF YOU ARE NOT REQUIRED TO ISSUE ONE !

While this SSCA covers cancelled debt its reasoning can apply to all information returns.

Swap 1099NEC for 1099C and their code sections.

https://www.unclefed.com/ForTaxProfs/irs-wd/1998/1998-020.pdf

CONCLUSION
Individuals or entities not required by section 6050P to file Form 1099-C may nevertheless voluntarily file such forms inappropriate circumstances.

The SSCA also says:

While the requirement to report discharges of indebtedness applies only to the entities described above, there is no specific prohibition in the Internal Revenue Code or the Income Tax Regulations that forbids the reporting of discharges of indebtedness by entities not required to report. Such reporting may encourage voluntary tax compliance and proper gross income inclusions

V

Vanessa A

When you say to another freelance individual, does that mean you are also a freelance individual? If so, then yes, you would need to file the 1099-NEC to deduct the payments made to the other freelance individual. A freelance individual is considered self-employed and treated as a business.

If this has nothing to do with you earning money (ex. homeowner hiring a contractor), then no, you would not issue a 1099-NEC.

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Z

zaebb1Author

No, i am not freelancer, not LLC.

I am person issuing cash payment 16,000$ to freelancer.

He did job for me (not for business or resell)..home improvement, graphic design..whatever.

If i dont issue 1099-NEC how would he claim 16000$ on his taxes without any proof where he got that money from?

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ee-ea

Deleted

VolvoGirl

If you file Schedule C for your freelance self employment in your personal tax return then Yes you need to issue a 1099NEC. Are you using the Online version or the Desktop program?

How to prepare 1099Misc & W2
https://ttlc.intuit.com/community/forms/help/how-do-i-create-w-2-and-1099-forms-in-turbotax/00/25869

You can prepare W2 and 1099NEC & 1099MISC in either the Desktop Home & Business program or the Online Premium version.

For Online Premium:
Sign in to TurboTax.
Select Tax Home from the left menu (you might already be there).
Scroll down and select Your account.
Select Create W-2s and 1099s.
This will log you in to Quick Employer Forms.
Follow the instructions to create forms online for your employees or contractors.

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zaebb1Author

No, I ma not freelancer. I am individual that paid 16,0004 to freelancer. (home improvement, graphic design, whatever. The job was not for business or resale).

Individual that hired freelancer and paid him for work.

People say I can not issue 1099-NEC.

So, how will freelancer claim 16,000$ on his taxes? How would he show where he got the money?

Thanks