1099 compliance checklist
1. Collect W-9 Before First Payment
Get the contractor's legal name, address, and Tax ID (SSN or EIN) via Form W-9 before you make any payments.
2. Track All Payments
Record every payment to each contractor throughout the year. Include date, amount, and description of services.
3. Determine 1099 Type
Most contractors receive 1099-NEC (services). Some receive 1099-MISC (rent, royalties, prizes). Know the difference.
4. File by Deadline
January 31: Send 1099 copies to contractors and file with IRS (paper or e-file).
Who needs a 1099?
✓ Issue 1099
- • Freelancers and consultants
- • Independent contractors
- • Sole proprietors
- • Partnerships
- • LLCs (in most cases)
✗ No 1099 Required
- • C Corporations
- • S Corporations (usually)
- • Payments under $600
- • Personal (non-business) payments
- • Credit card/PayPal payments*
*Payment processors issue their own 1099-K forms
Managing 1099s in BBos
BBos 1099 Management Features
- Contractor database with Tax ID, W-9 status, and address
- Automatic payment tracking and year-to-date totals
- $600 threshold alerts when approaching reportable amounts
- 1099 report generation with all required data
- Export for filing with IRS or importing into tax software
Common mistakes to avoid
❌ Missing W-9 Before Payment
Never pay a contractor without their W-9 on file. You'll spend January chasing Tax IDs.
❌ Forgetting the Deadline
1099s are due January 31—no extensions. Late filing = penalties starting at $60/form.
❌ Wrong Box Amount
1099-NEC Box 1 is non-employee compensation. Don't include reimbursements or product purchases.