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1099 Tax Form – What Is It?

If you received a 1099 tax form, save it. You’ll need it when filing your taxes.

If you received a 1099 form in the mail, you may not be sure what it is or what to do with it. Whatever you do, don’t throw it out. You’ll need the information listed on the 1099 when filing your taxes during tax season.

1099 forms are used to report income not included on a W-2 [Wage and Tax Statement], in other words income that is not included in wages, salaries, and tips.

The 1099 is most commonly used to pay independent contractors, such as freelancers and consultants, who are not official employees of a company.

If you received a 1099, you’ll need to report the earnings listed as self-employment income on a business tax return. RapidTax is here to help.

Variations of the 1099 Form

There are 24 different variations of the 1099 form, covering far more than just nonemployee compensation. Different 1099 forms report different types of income from interest and dividends to real estate sale proceeds and debt cancellation. Some of the most common 1099s include the following;

  • 1099-B [Proceeds from Broker and Barter Exchange Transactions] records all stock transactions and helps you report capital gains to the IRS when you file your return. Use your 1099-Bs to fill out Form 8949 [Sales and Other Dispensations of Capital Assets] as well as Schedule D [Capital Gains and Losses]. Continue reading “1099 Tax Form – What Is It?”