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Customer Asking For A 1099 ?

Discussion in 'The Taxidermy Industry' started by donelan07, Jan 23, 2023.

  1. I am a sole proprietorship part time taxidermist. I have a tax ID. Collect sales tax and pay twice a year. I had a customer pay with his business checks and now his accountant is asking me for a 1099? Is this normal? How do I go about it the most uncomplicated way possible.

    Thank You for any insight.
     
  2. 3bears

    3bears Well-Known Member

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    Is he also a resident of SD? I'm not certain how it works for sure but I have many customers pay with business checks. I pay my sales and income taxes on that income and it is up to them to figure out their end. Typically you give a 1099 to someone who works for you and you didn't collect income tax from.
     
    John C likes this.

  3. He is a SD resident. I collected sales tax and paid the sales tax to the state already. They got a receipt for work done.
     
  4. 3bears

    3bears Well-Known Member

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    Yep, that is how I do it in MN. I have 3 part receipts with my company info on them. I think I would ask if they need a copy of receipt. I didn't know SD charged sales tax on taxidermy services.
     
  5. msestak

    msestak Well-Known Member

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    a 1099 is a form showing that a worker paid income tax, not for someone that bought something with a business check. this doesnt sound right. maybe ask your accountant if you use one and simply tell the customers accountant to use his clients cancelled check.

    how much of your business info would go on a 1099 form ? sounds like a red flag
     
    Rabbitlady likes this.
  6. Keith

    Keith Well-Known Member

    Ask your accountant. That is not typical to give a 1099. Like 3bears said, he is not an employee or contract worker.
     
    John C and msestak like this.
  7. He was a customer. I thought it was very strange. I don't hire an accountant for my part time business and thought it didn't make sense.
     
    msestak likes this.
  8. Penczak

    Penczak Active Member

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    I mounted some beavers for SAS Institute that was destroying their land. They used it as a business expense therefore they wanted a tax id #. I was notified by a letter in which I ignored.
    I also mounted some squirells that were destroying transformers on Duke University property. They didn't need a tax id#.

    I'm told in both cases they put the mounts in the center of the table during a meeting on what to do about them.
     
    msestak likes this.
  9. 3bears

    3bears Well-Known Member

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    I am not giving any customer my tax ID number, I don't care who it is. All they need is my receipt with my company name .
     
    John C, pir^2h and msestak like this.
  10. msestak

    msestak Well-Known Member

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    anyone that knows how, can do a lot of things with your tax ID number. none of it will benefit you.
     
    Rabbitlady likes this.
  11. Keith

    Keith Well-Known Member

    Could it be the client's accountant is asking for a W-9? This way they can send you a 1099 so they can write off the work you did for them.

    I don't think that would fly with the IRS.

    Either way, this is a really interesting tax question, so keep us informed of what happens.
     
    Tnrandy, msestak and 3bears like this.
  12. 3bears

    3bears Well-Known Member

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    Interesting way of thinking or going about it, bush league but still interesting. If I remember, I will ask my accountant about it.
     
    msestak and Keith like this.
  13. pir^2h

    pir^2h Retrievers give you the bird

    Something sounds very weird about this. If the customer never worked for you he doesn't need a 1099. His accountant must have just graduated this past December and thinks he knows it all. All the customer needs is a paid receipt or cancelled check. Nothing more.
     
    EA, Rabbitlady, msestak and 3 others like this.
  14. Penczak

    Penczak Active Member

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    This is very very common amongst the trades. I agree, it should not apply to Taxidermist.
     
  15. 13 point

    13 point Well-Known Member

    Yea a 1099 is for income , not paying for a service, I think his accountant has it screwed up
     
  16. EA

    EA Well-Known Member

    Here is my 2 cent. It's medical billing, not taxidermy, but business is business.

    I've had people who worked for me that wanted to pay their own taxes.
    At the end of the year I sent them a 1099 documenting the money that I paid them and they were responsible for paying the taxes on that money. They were my contractors.

    Also, I work for a lot of clients who pay me all year long. At the end of the year, they send me a 1099 and I am responsible to pay the taxes on the money they paid to me. I am their contractor.

    My clients have my tax ID. My tax number is on those 1099's. I just received one today.

    I believe the accountant was asking for a W-9 (Your tax number) so they can fill out their 1099 and send that to you. He's treating it like you were his contractor. He paid you. You owe the taxes on that money. Paying you thru the business, you're an employee or a contractor. An employee would trigger Fed, state and local taxes for him.
     
    Last edited: Jan 26, 2023
    Penczak likes this.
  17. msestak

    msestak Well-Known Member

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    still doesnt sound legal. if it is, wouldnt that mean when we hire a plumber or carpenter for instance we can send those folks a W-9 and treat them like contractors.

    i wouldnt do it.
     
    Jerry Huffaker, Keith and Kerby Ross like this.
  18. EA

    EA Well-Known Member

    You have a point msestak. They would give you a w9 not the other way around, but I see your point.

    If I'm lucky enough to win more than $600 fishing I'm sent a 1099. I don't know how much money is involved guess he needs to speak with the accountant and see what's up.
     
    livbucks and msestak like this.
  19. joeym

    joeym Old Murphey

    I receive several 1099's annually from corporate customers. They request a W-9 from me when specimens are completed. I receive a check in the mail, they come get their mounts, and I receive the 1099 in January. Here are the rules on a 1099. It's just another way the government has of validating business expenses so that taxes will be paid on them. My business is an LLC. Sometimes I wonder if filing a 1099 is needed by me. They ask, I comply. I DO pay taxes on all documented income.

    The 1099 form is used to report non-employment income to the Internal Revenue Service (IRS). Businesses are required to issue a 1099 form to a taxpayer (other than a corporation) who has received at least $600 or more in non-employment income during the tax year.
     
    livbucks, msestak and EA like this.
  20. 3bears

    3bears Well-Known Member

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    I still don't understand the need for anything other than a receipt to verify they paid your business for something. Taxidermy is more of a retail type business. I don't need anything other than those to show what my operating expense is for my business. In MN taxidermy is considered a manufacturing/retail business and sales tax must be collected and paid on everything, therefor taxidermists have to claim all income and pay income taxes on it.
     
    msestak and Keith like this.