1099 Help

[woodmills1]

taxes are tough


neeed to do the math
and the homework

[bugdust]

Dang, I only sold $599 worth last year. Sorry about their luck.

[Ironwood]

Terrific,
 
 You are already creating a "paper trail" with reciepts and invoices that we all use to do our annual accounting, the additional 1099 stuff only create more paperwork (I hate), the only thing missing from the reciepts are folk's FEIN (Federal Electronic Identification Number, for corporations, or Social Security Number, for individuals). I find it VERY redundant and frustrating.


 Ironwood

[pnyberg]

I charge sales tax on my sawing services as required by law

In Connecticut?  I can't find anything that indicates that sawmill services are subject to sales tax in Connecticut. 

--Peter

[Ironwood]

Sales tax issues/rules are VERY conveluted. Because I do so many differing things/sales situations I have a State Tax Agent on my phone registry and I call her frequently to clearify all the permiatations/ combinations. She then knows I am doing my best to follow their regs. Even she many times has to "get back with you" response.

    Ironwood

[terrifictimbersllc]

Another complication, anyone know how it is handled?

I charge sales tax on my sawing services as required by law,  so if someone sends me a 1099 with the total amount paid, some of this would be sales tax. When I enter this amount under "payments from 1099's", the sales tax amount will then be taxed as revenue, which it should not be,  unless I deduct it somewhere.  Unless the payer is not supposed to include sales tax amounts on the 1099.

Regarding question about taxability of sawing services,  see my reply in Business and Managment board (reply #3) on this thread:  http://www.forestryforum.com/board/index.php/topic,55938.msg809496.html#msg809496)

Also concerning my own question  quoted above, an IRS 1099 expert told me that the entire amount of an invoice for services is put on 1099 misc, where the latter is required, box 7 "nonemployee compensation".   Apparently it's up to the recipient to deduct the sales tax as an expense (he wouldn't confirm not his area).

[Handy Andy]

  My experience with the sales tax people is that they always say "yes" you should collect and pay sales tax, even when sometimes the accountant says no. And the accountant is right.  A good accountant is someone whose service you cannot do without.  His knowledge and advice will make you successful, and could even keep you out of jail.  I've only been audited once, and the auditor told me that even though I would have to pay in some money, would not have to worry about going to court.  A bank made a mistake on a closing statement, and the accountant posted a profit item to the expense side.  Cost me about 3500, and the IRS has never bothered me again.