If you work with contractors/vendors/attorneys/landlords and you typically pay them more than $600 during the year, then you know that you have to send them a 1099 at the end of the year. Trying to chase them down in January to fill out their W-9, in addition to calculating how much you’ve paid them to put on the 1099, is the worst way to spend the start of a New Year. And your accountant is probably especially fond of doing this for you, too (sarcasm).
So let’s not do that this year. If you will do a couple of things during the year (like…now), the issuing of the 1099s is such a simple process:
1) Get W-9s to your vendors to fill out if they have not given you one already.
2) Keep your bookkeeping up-to-date with accurate vendor information and payments.
That’s it. Many of my clients are accustomed to getting those W9s up-front – won’t even pay a vendor without one. It’s not a coincidence that this usually gets them my best rates and fastest service – it’s not a personal preference thing, it’s just about efficiency and simplicity. It’s good business.
There are much better ways to begin the new year – planning and forecasting, enjoying holidays, building your business,…etc. Bless yourself, and your accountant, with a little extra preparation this year.