This flowchart will help the decision process to determine which vendors require a 1099.
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Did this vendor perform a service, provide medical treatment/services, or provide legal advise for you or your business? Or did you pay rent to them?
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YES
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Was the value of all services performed or rents paid during the past year $600 or more?
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YES
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Is this an individual as opposed to a company?
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NO
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Does the name of the company end in INC?
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NO
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You must have a W-9 to determine if a 1099 is needed. Go to the next chart.
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NO
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NO
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YES
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YES
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You do not have to send a 1099 Misc.
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Was the vendor an attorney or provide legal advise?
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YES
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You must send the vendor a 1099 Misc. Also,set the vendor as a 1099 vendor in Profund.
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You do not need to send a 1099 Misc unless the vendor is an attorney or provides medical services. Also, the vendor will need to be set up as a 1099 vendor.
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NO
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You do not need to send a 1099 Misc.
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Use this section after completing the first section to determine if a 1099 Misc is needed. Do you have a W-9 on file for the vendor in question?
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YES
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Is LLC checked on the top portion of the W-9?
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YES
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Does the space on the line, to the right of the LLC check mark have a letter in it?
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YES
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Is the letter a P?
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NO
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You are not required to send a 1099 Misc for S or C Corp unless the vendor is an attorney or provides medical services/treatment.
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NO
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NO
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NO
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YES
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You must have a W-9 to continue.
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Is C Corp or S Corp checked?
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You need to request another W-9 from the vendor. The W-9 form is either incomplete or an old W-9 form. The safest thing is to send a 1099 Misc.
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You must send a 1099 Misc only for services including medical, legal advise, or rent.
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This vendor needs to be set up as a 1099 vendor in Profund. The AP clerk will un-check in payable if not for services including medical, legal advise, or rent.
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NO
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YES
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If Parternership is selected, a 1099 Misc is needed for any services including medical, rent, or is an attorney. Otherwise, a 1099 isn't needed.
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A 1099 Misc isn't needed for C Corp or S Corp EXCEPT if the vendor provides legal advise or medical services/treatment.
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1099 Help Chart
