1099s can be a headache — especially when you have to gather all the necessary information in a short amount of time. Don’t wait until January to make sure that your clients have the information needed to file 1099’s. Now is the time to make sure that W9 information and 1099 status are up-to-date for each of your clients’ vendors.
We know: you’ve already got a lot on your plate. And the deadline for 1099-MISC, 1099-S, and 1099-B forms can be as soon as January 31, which seems sooooo far away. The tricky thing about 1099s, however, is how much they encapsulate. Here are some tips for how to get ahead of the curve AND develop year-round procedures to stay on top of this work.
What work can you be doing NOW?
Look through vendor information! You want to find out which vendors have been used in the past year, whether they have a W9 on file, and all their information is up to date. Names, addresses, and ID numbers should all be current. If you have to send a W9 request, be sure to send it early and follow up with the request no less than a week later if you haven’t received a response. Once you have these documents, you’ll also want to keep that information stored somewhere safe and secure.
Don’t forget the little things
One of the ways 1099s can trip up clients is the vast types of services they cover. You’ll want to make sure your client is aware of everything they need. Some of the vendors that are often overlooked are landlords, attorneys, and medical corporations. Send 1099 to these vendors early and keep track of all monetary transactions — including expense reimbursements. Remember: it’s always better to have too much information than too little. You don’t want to be missing any important details.
Make 1099s a part of your regular schedule in the future
The easiest way to avoid scrambling to get things on the book last minute is to stay ahead of the game. Advise your clients to send out 1099 forms to Vendors BEFORE any business transaction occurs. You should also try running a quarterly report to ensure there are no surprises at year-end. Running regular reports can help you find holes in documentation before they become a problem. If you are paying the client’s bills for them, be sure to add this as a step in the process — before the check is released!
Watch for changes
Tax season is always throwing new hurdles at bookkeepers. Make sure you’re staying vigilant and up-to-date with any changes in 1099 rules. The last thing you want is surprises when you’re already busy enough.
Year-end is a lot of work, but it doesn’t have to be hectic… so long as you do your preliminary work and create solid and easy-to-follow procedures. Aero Workflow makes it easy to track payments, schedule 1099 tasks, and organize your procedures. Schedule a demo to see how you can make year-end procedures a breeze!