Now is the time to make sure you are ready to prepare W2s and 1099s for your business. Do you have the forms? Toward the end of the month, the forms get harder to find in your local office supply store because they do not want to be stuck with excess forms after the deadline for preparing them has passed. If you do not need laser forms, you an order forms from www.irs.gov for free. But you will want to get that order in so you can be certain of receiving the forms in time to use them. W2s, W3 transmittal, 1099 Misc and 1096 transmittal are the most common forms you will need.
If you are having your accounting firm prepare returns and forms for you, you will want to contact them and get on their schedule as well because the later in the month it gets, the busier they are. So get in line to ensure a smooth process completed by the deadline.
Make sure you have all the information you need. For employees: current addresses and social security numbers. For 1099 Contractors; current addresses and their federal id number. Sometimes this can be a social security number, sometimes a federal id number. You can request that your contractors send you a Form W9 which has all the pertinent information you need to issue them a 1099. Corporations do not get issued a Form 1099, but individuals, LLCs and partnerships do.
Some people you have to bug because they do not want you to issue them a 1099. Persist and let them know you will prepare one with all of the information you have because if you do not prepare a 1099, you are not allowed to take the deduction for the amount paid to that vendor.
It is a good idea to get this information when you first set up a vendor so you do not have to deal with the hassle later. Plus, you can withhold their first payment until they give you all the information you need to prepare the 1099 at the end of the year.
If you need assistance preparing end of year payroll returns and forms or Form 1099 and the transmittals, contact us.