Earlier, we talked about landlords and tax time, but did you know that there are sometimes special tax issues and situations for property managers? It’s that time of year again- end of the fiscal year and if you’ve been paying people to do yard work or take care of other things around the properties, odds are, you need to send out Form 1099.Though we, or anyone else is unable to give you tax or legal advice, and you should always consult your tax adviser, there are a few things that you need to know about 1099 for property managers.
If your workers are employees, this doesn’t apply but there may be another situation in which you need Form 1099. For instance, you may also need to file Form 1099 for those clients you work with. You cannot simply make your own form, either, you need to have them provided by the Internal Revenue Service. These forms enable the IRS to compare notes and essentially, be certain that everyone’s income tax is taken care of accurately.
If you don’t issue an 1099 to your contractors, there can be penalties and disallowances for the amounts that have been paid. It’s important to be sure to comply with all the filing requirements. Not only is this the law, but it’s also just good business ethics to help your contractors better handle their own taxes in a timely fashion by giving them the information they need to prepare. Of course, being able to have all of your reports in one place helps.
Many people are still dealing with the headaches of having to deal with automatic mailings and putting together big bulky packages that cost money to send. This is a thing of the past with more modern property management software enabling people to have all of the information and reports in one place. If you’re still dealing with the paper and pen nightmare of tallying things up, why not give our plans a look and make your resolution to not have to do that again for the 2014 tax season?