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The turning of the new year is a time for a new beginning. Unfortunately, January is also the time when the tax season begins in earnest. 1099-MISC filings are on of the first things that come up.

1099 tax forms are known as information reporting forms. They are used to essentially collect data by the IRS on who is paying what to whom. If you received dividends during the year from a company, you’ll receive a 1099 for those dividends.

While there are different types of 1099s, the 1099-MISC is the form that gives the most people the most trouble.

The 1099-MISC form is an informational return you must file with the IRS if you paid certain things during the year. For instance, if you paid an attorney any legal fees during the year, you must file a 1099 with the IRS indicating that amount.

A more common area 1099-MISC forms must be filed is with independent contractors. Let’s say you have a business and you decided to open a website in 2007. You hired a 20 year old kid to do it because…well, 20 year old kids do the best work! He did a good job and you paid him $1,000. You are required to file a 1099-MISC form indicating that you paid him as much.

Okay, so when does all this have to be done. Well, the deadlines start popping up quickly after the beginning of the year. In fact, the deadline date for this filing is a bit of a trick question. Why? There are TWO deadlines. The first is January 31st. You must send copy B of the form [it comes in triplicate] to the person you are reporting income for. Using our example above, you would send it to the kid that designed your website.

The second deadline is, of course, the filing with the IRS. You must file the original with the agency by February 28th if mailing it in. If you choose to file electronically, you have till March 31st.

Now, there are a couple of things you must know about the 1099-MISC form. First, you can’t print it off the IRS website. You have to get a hard copy because it comes on carbon paper in triplicates. Second, you must also file a form 1096 with the copy you send into the IRS. What is a form 1096? It tells the IRS how many information returns you are sending in. Welcome to the duplicative, redundant, confusing world of taxes.

Although the 1099-MISC filings are a bit of a pain, there is a silver lining. Getting the information together helps you get organized for the much bigger battle of filing your tax returns for the year.

Richard A. Chapo writes about [http://www.businesstaxrecovery.com]federal income taxes for BusinessTaxRecovery.com.

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