Do I Have to Give My Handyman a 1099?

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Understanding 1099 Reporting Requirements

1099 forms are used to report payments made to nonemployees for services performed. The purpose of 1099 reporting is to ensure that the IRS is aware of all income earned by individuals, even if that income is not subject to withholding.

Who Must File 1099 Forms?

Businesses are required to file 1099 forms for any nonemployee to whom they have paid $600 or more in a calendar year. This includes payments for services such as:

  • Independent contractors
  • Freelancers
  • Consultants
  • Handymen

Who is Exempt from 1099 Reporting?

There are some exceptions to the 1099 reporting requirement. For example, businesses are not required to file 1099 forms for payments made to:

  • Corporations
  • S corporations
  • Limited liability companies (LLCs)
  • Partnerships

Handyman Services

Handyman services are typically considered to be a trade or business. This means that if you hire a handyman to perform services for your business, you are required to file a 1099 form for the handyman if you pay them $600 or more in a calendar year.

However, if you hire a handyman to perform services for your personal residence, you are not required to file a 1099 form. This is because the handyman is not considered to be a trade or business in this case.

Example

You own a rental property and hire a handyman to make repairs to the property. The handyman is not your employee, and you pay them $800 for their services. You are required to file a 1099 form for the handyman because you paid them more than $600 for services performed for your business.

Whether or not you are required to give your handyman a 1099 depends on whether or not the handyman is considered to be a trade or business. If the handyman is performing services for your business, you are required to file a 1099 form if you pay them $600 or more in a calendar year. However, if the handyman is performing services for your personal residence, you are not required to file a 1099 form.

How To 1099 Someone – How Do I Create, Send, File 1099s for Independent Contractors from my Business

FAQ

Do I give a handyman a 1099?

You are required to file a federal Nonemployee Compensation (Form 1099-NEC) or a Miscellaneous Information (Form 1099-MISC) for the services performed by the independent contractor. You pay the independent contractor $600 or more, or enter into a contract for $600 or more.

Do I issue a 1099 for repairs and maintenance?

But you have to provide a 1099 to any business other than a corporation who performs services for your business. For example, the auto mechanic who repairs the company truck; the electrician who came in to add outlets in your office; etc. You must also send a 1099 to the person to whom you pay office or other rent.

What happens if you don’t give a contractor a 1099?

If a business intentionally disregards the requirement to provide a correct Form 1099-NEC or Form 1099-MISC, it’s subject to a minimum penalty of $630 per form (tax year 2023) or 10% of the income reported on the form, with no maximum.

Do I have to issue a 1099 to my cleaning lady?

Only Businesses Need to Issue a Form 1099 You don’t need to issue your housekeeper a form 1099. Your business must file a form 1099 with the IRS and to each unincorporated business or individual to whom you paid $600 or more during a given tax year.

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