1099s are annual forms you are required to send to your subcontractors. The law states that if you pay someone and it is not through an employee w2, you have to share this information with the IRS so the payment information is recorded and they are aware of it.
Anyone paying money to a person over $600 and not through payroll must file a 1099 for the contractor or individual.
At the moment, we are using Quickbooks 1099 service. We submitted early before Jan 12 so it only cost us $12 for 3 subcontractors. It was efiled so the only paperwork we are required to send is paper copies to the contractors the IRS copy Quickbooks takes care of efiling.
Given that the payments to the vendors were all properly recorded already since we do our books once a week, it was a very simple process. We also had to make sure that within the vendor profile the checkbox that says eligible for 1099s was checked off.
The vendors appeared in the list and were very easy to process.
