Year-End 2024: Non-Payroll Action Items

Yep, here we are again. If you’re an elf with accounting responsibilities, now is the time to put your gingerbread house in order so you’re ready for year-end reports. Here’s your action item list:

Forms 1099

There are multiple types of 1099s – each with a different purpose. Here’s the list in alphabetical order (click on each one for the specific instructions):

1099-B, Proceeds from Broker or Barter Exchange Transactions

1099-DIV, Dividends and Distributions

1099-INT, Interest Income

1099-MISC, Miscellaneous Information

• Use 1099-MISC to report payments such as (see the form’s instructions for a more complete list):
  • At least $10 in royalties or broker payments in lieu of dividends or tax-exempt interest
  • At least $600 in:
    • Rents
    • Prizes and awards
    • Other income payments
    • Gross proceeds paid to an attorney
    • Nonqualified deferred compensation

1099-NEC, Nonemployee Compensation

• Use 1099-NEC to report payments of at least $600 to non-employees who provided services to your business and payments to an attorney. See the form’s instructions for more details.

1099-R, Distributions from Pensions, Annuities, Retirement or Profit Sharing Plans, IRAs, Insurance Contracts, etc.

Regardless of which 1099 form you use, they’re all due January 31, 2025 for payments made during 2024. You can find general instructions for 2024 form 1099 on the IRS website by clicking here.

New for 2024 Filing:

If you have more than 10 Forms 1099, they must be submitted electronically.

And then there’s Form 1099-K . . .

Unless you’re a credit card company or run a payment app or online marketplace (known as “third party settlement organizations”/TPSOs), Form 1099-K will affect you more as an individual than as a business. TPSOs will be required to report transactions of more than $5,000 in 2024.

Entities that may receive Form 1099-K include retailers and businesses that accept online credit card payments and other electronic payments from customers. It also includes payments to individuals through Venmo and Paypal. If your work is part of the “gig economy” and you provide services such as driving for Uber, delivering for Amazon, providing freelance services, selling items on Etsy or Ebay, or renting out part or all of your house, and your income from those activities exceeds $5,000, you may receive a Form 1099-K.

More information about Form 1099-K can be found here.

Gather Your Missing Forms W-9 Now

Now is the time to make your list (of vendors) and check it twice. You should have a Form W-9 on file for each vendor so you’re not overwhelmed at the last minute with gathering correct name, address, and FEIN.