As an online entrepreneur or small business owner, handling your finances can be a complex task. One crucial aspect of financial management is ensuring that you correctly prepare and distribute 1099 forms to your contractors. A lot of new business owners get blindsided on this one!
In this blog post, we'll delve into what 1099s are, who should receive them, the different types of 1099 forms, the deadlines you need to meet, and the tools that can help you efficiently manage this process.
Before we dive into 1099s, let's define contractors. Contractors are individuals or entities that you hire to perform specific services or tasks for your business. Unlike employees, contractors are not on your company's payroll, and you typically don't withhold taxes from their payments. Instead, they are responsible for handling their own tax obligations. Head over to this blog post where I discuss in more detail Employees vs. Contractor (one of our most asked questions!).