Box 6 vs. Box 7 Form 1099-MISC for Interpreter
I have a specific situation that I'm unable to get an answer too so I need your help. I have went back to the 1099-MISC form instructions but still can argue both scenarios. Okay so it involves the 1099-MISC form. The recipient is a vendor who performed service in California for us. The business is a translation business and the service performed was interpreting/translation service at a doctor's office for an employee of ours which is on worker's comp. The recipient has provided us her W-9 which is we have reported under her individual name and SSN. The problem is that the payment was reported on the 1099-MISC form in box 6( Medical and health care payments).
I received a phone call from the supplier stating the her other 1099-MISC forms that she recieves from other companies have always reported her services under box 7 (nonemployee compensation).
What is the proper reporting box for these type of services. Would it be considered medical if the interpreter was at a doctor's office performing the service? I know that we use interpreters also for legal claims which do get coded differently but not sure if where they get reported, under box 7 or 14.
Legal Settlement Payment to Companies that Buy Debt
My company is a title insurance underwriter. Our legal department often sends claim settlement payments made to companies that buy tax debt from the various states and charge extra fees to pay off the debt, usually interest.
Now my department deals with 1099MISC. Are these payments reportable on the 1099MISC? If so, which box and what amount do I report (the whole amount or just the interest)? These companies tend to be very resistant to sending a form W9, so I need to know if backup withholding is necessary.
As a followup question, if the above income is not reportable on a 1099MISC, is it reportable at all by any form of 1099 (maybe 1099INT, but doesn't really seem to apply)?
Let's start with a general rule that should help your understanding going forward and then get into the meat of the answers to your questions as follows:
Settlement Payment to Contractor and Attorney
If the payment is written to the contractor and their attorney, do I still report both? Or can I complete my reporting obligation by reporting the payment as gross proceeds to the attorney only? If the answer is both, should box 3 and the total amount of the settlement payment be reported to the contractor for their lien for services provided?
For payments involving legal services, there are a number of rules you will want to keep in mind regarding the differences in reporting when different names are on the check.
For instance, payments to attorneys who have performed services for your company are standard non-employee compensation, have a $600 reporting threshold, and are reported in box 7 of Form 1099-MISC.
Claim Settlement Requests for Liens, Mechanic Liens and Reporting
My company is a title insurance underwriter. Often our legal department sends claim settlement requests for liens. Most come from tax liens from various levels of government (state, county, city, district, etc) and from my understanding, are not reportable on the 1099MISC.
But what about mechanic liens from various contractors. I have been treating them as reportable, only excepting those that were corporations (sadly, no more), but I am wondering which box should be used for reporting the payment. As the expense are for services rendered, box 7 seems appropriate, but as they are usually made as a settlement payment, should this go in box 3 instead?
Settlement payments have very different reporting rules versus other payment types. They are a particularly tricky issue and typically you must report in a multitude of ways.
In this regard you must be careful as a number of different boxes on the Form 1099-MISC in particular come into play in such situations.
How to Report Residential Customer Buy Out Payment Regarding Natural Gas Pipeline?
The facts of the situation are a bit vague. However what I have been able to find out is this.
We have a residential customer on our natural gas pipeline and because of a project that is being undertaken, we are buying out the customer so that he will no longer be on the pipeline.
The customer's accountant believes that he should receive a 1099MISC as a rental/lease payment.
I am inclined to think it is more of an other income payment, reportable on 1099MISC, box 3.
Others think the customer should receive no 1099 as the payment would be damages, i.e. a damage payment for the reduction in value to the property because it can no longer be on the pipeline.
What are your thoughts?
Settlement Payment to Non-Attorney for Title Claim Issue: How do I Report?
I have a payment over $600 going out for a settlement on a title claim issue going to an individual who is not an attorney.
The exact description presented to us for the payment is:
S/He is one of two owners of the property but s/he did not sign the mortgage so we sued her/him to encumber her/his interest. S/He decided to sign away her/his interest in the property for $X,XXX thereby remedying the title defect.
Is this payment reportable on the 1099MISC? If so, does this belong in Box 3?
Do I Report to an Incorporated Law Firm?
Please clarify - on page 28 of the 2010 Year-End Reference Guide - Tools and Tips for Reporting Legal Service.... 4th paragraph. "Except for the fact that the corporate exemption is not available to the attorney or law firm. Thus, even if the law firm is incorporated, you are obligated to report the payment."
I understand the reporting requirements for settlements, etc. - but, are you saying that we should report all payments that we have made to all law firms who are Incorporated if the threshold for the calendar year is $600 or above?
Exceptions to rule exceptions are never fun. Moreover, payments to attorneys are particularly complicated issues.
Nevertheless, here is what you need to know in regards to such situations:
A payment to an attorney is not reportable in the following situations:
Settlement Payment and Dispute Over Its Status as Wages or Not
We, as administrator of the company savings plan have entered into a settlement agreement with an employee over what the employee feels was a mistake made to his account by the administrator. While we don't agree that a mistake was made, it is less costly for us to settle than to dispute it.
We are convinced, given the facts, that the settlement payment is not wages. Do we have an obligation to report this payment on an informational return? And if so, which form? If reportable, would it be on Form 1099-Misc, Box 3?
Reporting the payment to the claimant depends on what the settlement is for. There is no reporting to the claimant if:
Lease and Payment to a Broker - How do we handle the reporting?
I paid the broker. The broker is acting as Owner's Listing Agents. The Fee is for a broker fee for a lease. Is this reportable?
Your question mentions the word “lease”. This is a very important term as the type of lease can define if you are dealing with a rental payment or not. As such, please find below a primer on rent and leases.
Bankruptcy Payment to Attorney as Trustee
1) My company is making a claim payment to a Bankruptcy attorney, as a trustee. As the payment is in his name, can we use the bankruptcy attorney exception for 1099MISC reporting? 2) Exactly which Chapters of Bankruptcy are attorneys exempt for? My company has paid attorneys for Chpt 7, Chpt 11 and Chpt 13 so far, and I want to know if the attorneys are all equally exempt. 3) Are Bankruptcy trusts exempt from reporting? Are any trusts exempt from reporting? 4) My company sometimes makes payments to Bankruptcy trustees who are not attorneys. Are these payments reportable and whose tax ID do we need if the payment is made to the trustee (the trustee or the trust)?