During the month of January, we at Perfect Balance Accounting Services, LLC spend our days feverishly completing 1099’s for those of you who request our processing assistance.
As a refresher, a 1099 is issued to any vendor which your business paid in excess of $600.00 and does not hold corporate status. We get why you farm out this technical responsibility, it can be confusing which companies need to be issued. Why give yourself the anxiety of whether you are issuing correctly when we at PBA make it our business to understand these requirements?
The point of this post is to help you by explaining one crucial step that sometimes is overlooked at the time you add a vendor to your payables. This saves time for us later, getting you your 1099’s completed quicker. This post is selfish, really.
At the point you are approved as a customer to your vendor, please request their W-9. This document details their corporate status, their Employer Identification Number (EIN) as well as their address. It is important for you as a business because you are capturing their legitimacy as a tax paying entity. It is imperative that in the case you are ever audited, may the tax gods shine their favor upon you, it can prove your due diligence in itemizing the taxes owed to good ‘old Uncle Sam. I joke, but seriously, this is very important.
When this small, but critical step is applied, it saves so much time in January when the 1099’s come up for filing. You can supply PBA with all your W-9’s and we can do our magic, which is what we are set upon this Earth to do. It gives us so much pleasure to ensure we protect our clients from the Big Bad: the IRS. It gives us the heebie-jeebies just thinking about them.
As always, we appreciate your business, and we really appreciate you taking the time to read this post. We hope it was informative (and a little enjoyable).