What is a 1099 tax?

McGruff

1099 forms are used for a number of reasons, generally miscellaneous income not considered wages, tips and salary normally reported on the W-2. Typically, 1099's are given to independent contractors, also known as freelancers, as a record of the income they received from a particular business. On a 1099 MISC form, the income earned will be noted, but there will not be any deductions for federal and state income taxes, social security, health insurance or retirement savings since the 1099 recipient is not an employee of the business. This 1099 income is also reported to the Internal Revenue Service so it has the opportunity to track income from freelance workers. The freelancer will be obligated to make his or her own tax deductions and forward such payments to the IRS. 1099 INT forms are issued by savings institutions and the government to show any interest they have paid to you in a particular tax year, and 1099 G form denotes any tax refund you may have received from the government. http://www.wisegeek.com/what-is-a-1099-form.htm?referrer=adwords_campaign=1099form_ad=011121&_search_kw=what%20is%20a%201099 Nov 03 05, 10:55 PM

McGruff

This site describes a few more of the various 1099 forms. Form 1099-INT reports the amount of interest you earned during the year. These forms usually come from banks, but if you maintain an escrow account with your mortgage lender, you'll likely receive a 1099-INT from your mortgage company showing the amount of interest your escrow account earned during the past year. Form 1099-DIV reports the dividends you received during the past year. Mutual funds, brokers, and companies you've invested in will send these to you by the end of January. Form 1099-B reports all of the stock and security investments you sold during the year, along with the amount of proceeds you received from the transactions. Form 1099-G reports government payments to you. The most common Form 1099-G payments are state tax refunds and unemployment compensation. Form 1099-MISC reports royalty income, rental income, self-employment income, and other miscellaneous income. Form 1099-R reports distributions from IRAs and other retirement plans. Form 1099-SSA reports social security income you received for the year. http://www.turbotax.com/articles/GetOrganized.html Nov 03 05, 11:02 PM

miltonebx

There is a Box on all 1099 forms for Federal Withholding Tax to be deducted. The Payer will deduct the tax unless the Payee submitted an exemption form to the Payer. The Payer is also not obligated to issue a Form 1099 if the payment(s) are under $600. Nov 04 05, 7:04 AM