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What is Form 1099-NEC? It’s an essential IRS form for reporting payments over $600 to non-employees like contractors and freelancers. Understanding and filing this form is key for tax compliance. 💼

👉 WHO needs to file? Any business that paid $600 or more to an individual or entity for services in a year.

👉 WHY file? It’s not only a legal requirement but also aids your contractors in managing their tax responsibilities.

QuickBooks streamlines this process: e-filing with the IRS, electronic delivery to contractors, and even traditional mail options are available. 🖥️📬

Plan ahead to meet these important dates:

Jan 1: Begin e-filing through QuickBooks
Jan 28: QuickBooks recommended completion date
Jan 31: Official IRS filing deadline

What’s included on the form:
▶️ Payer’s Information: The name, address, and Taxpayer Identification Number (TIN), usually an Employer Identification Number (EIN), of the business or individual making the payment.
▶️ Recipient’s Information: The name, address, and TIN (either a Social Security Number or an EIN) of the non-employee (contractor, freelancer, etc.) receiving the payment.
▶️ Total Amount of Payment: The total amount of non-employee compensation paid during the tax year. This includes fees, commissions, prizes, awards, or other forms of compensation for services rendered by an individual who is not your employee. It only includes payments of $600 or more during the year.
▶️ Federal and State Tax Withheld: If any federal or state income tax was withheld from the payments, this would be reported here. This is not common but can occur in certain situations.

Stay informed and stay organized.

✨Follow me for more business finance tips

#greenscreen #entrepreneur #businessfinance #1099contractor #1099nec #businessfinances #quickbooks #businesstips #smallbusinesfinances #smallbusiness #scorp #llc

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Filing deadline for most businesses is Jan 1,2025! Dont forget to get this completed ✔️ For my bookkeeping clients, if you need help reach out and we will do this together over zoom (no charge) #entrepreneur #smallbusiness #businessfinance #smallbusinessowner #businessowner #llc #scorp #entrepreneurtips
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Paying Yourself as a Single-Member LLC: Let’s Simplify It! If you operate a single-member LLC taxed as a disregarded entity, paying yourself can feel a little confusing. Here’s the breakdown: As a disregarded entity, your LLC doesn’t pay income taxes directly—instead, the profits are reported on your personal tax return (Schedule C). So whether you withdraw the money or leave it in the business, you’re taxed on the profits, not the withdrawals. A. Leave All the Profit in the Business Say your LLC makes $60K in profit, and you leave it all in the business bank account. While it might feel like you’re “saving” the money, you’re still taxed on the entire $60K. Keeping the money in the business doesn’t change the tax responsibility—it’s all about the profits earned, not the amount withdrawn. B. Withdraw All the Profit Want to take out the entire $60K? Go ahead! Your taxes won’t change because, as a disregarded entity, you’re still taxed on the $60K in profit whether it stays in the business or lands in your personal account. C. Split the Difference Maybe you withdraw $30K and leave $30K in the business. Guess what? Your taxes remain the same—you’re still taxed on the full $60K profit. Key Takeaway: As a single-member LLC taxed as a disregarded entity, withdrawals don’t impact your taxes—profits do. But strategic withdrawals can help with liquidity, cash flow management, and personal financial planning. 👉🏻 Follow for more tips on managing your business finances. #llc #SmallBusiness #entrepreneur #BusinessFinance #GettingPaid #LLCPlanning #BusinessGrowth
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