what form do i need or do i need one?

Question

i am starting a small bussiness and i am going to file 1099. my question is what form does the employers have to file or do they when they are hired?

I am a contractor that has employees that work for me. I get paid then i have to pay them i dont want to have to pay the whole $ if i am not recieving the whole $.

Answer 1

If you're starting a small business, YOU are your own employer. The people or firms you provide goods and services to are your customers, not your employers. Anyone who pays you more than $600 for services rendered in any year should provide you with Form 1099. Even if they don't, you still must claim the income that you received. You will need to provide them with your taxpayer ID number -- either your SSN or an EIN, Employer ID Number -- so they can properly complete the Forms 1099. They will use Form W-9 to request that. You'll complete the W-9 and return it to them.

When you file your tax return, you'll attach Schedule C or C-EZ to Form 1040 to claim your business income and expenses and calculate your net income. You'll then attach Schedule SE to calculate the self-employment tax at 15.3% of your net income. Then you'll complete the Form 1040 to figure your total tax liability.

If you expect to owe more than $1,000 in total taxes you must make quarterly estimated payments using Form 1040-ES. The 1040-ES package has worksheets to help you estimate your income for the year and calculate the required payments.

At the end of the year when you file your return you'll take credit for the estimated payments against the tax liability on your Form 1040 and either pay the balance due or (usually) mark the excess to be applied against next year's tax liability. You could opt for a refund check but most self-employed folks just let it ride to reduce the size of the required estimated payments throughout the next year.

If your state has an income tax, you'll also have to make estimated payments to your state in most cases.

Edit: OK, since you will have employees of your own, you'll need to set up a payroll system to pay them. You cannot give employees 1099s, you have to withhold taxes from their pay and pay payroll taxes yourself.

I'd urge you to consult with a local CPA to get the ball rolling. Payroll taxes are complex and you can get in deep do-do with the IRS if you mess it up. Alternatively you can hire out payroll preparation to any number of firms for a fee. It will allow you to focus on your business instead of worrying about payroll.

BTW, you MUST pay your employees whether you get paid or not so it would be a good idea to work out a line of credit for payroll purposes with your bank if there are any cash-flow issues. Not paying your employees will get you in even more trouble than not paying the IRS!

Answer 2

Your question makes no sense. A 1099Misc is what is given to an independent contractor for goods or services provided in amounts over $ 600.00. Hired employees are a whole different breed of cat.

Answer 3

Take Bostonian's advice here.