It’s the time of year when you need to be thinking about reporting to the IRS what you have paid to employees. While reporting full-time staff salaries is usually straight forward, part-time employee and contractor reporting can be tricky for smaller firms with limited accounting budgets.
Here’s the gist: Though specifics can vary, the IRS usually requires freelance employees, recurring sub-contractors or any contractors paid more than $600 yearly to receive a 1099-MISC form that must also be filed with the IRS. Filing for calendar 2012 opens this month and runs until February 28, with an extension to April 1 for electronic filers.
While working with an accounting professional is advised, the IRS has been aggressive about creating easy-to-use online resources to make 1099-MISC reporting easier.
Check out the tips at Entrepreneur.com for reporting part-time contractor wages, plus the tools you need to get it done.