Landlords, Investors, the Federal Government is looking to make sure it can capture all possible income and you are on their radar. If you own rental property’s be prepared. This new rule further emphasizes another good reason to hire a property manager to keep your rental properties in order. Small mistakes will cost you dearly. Presidio Real Estate Services has an automated program to organize and disseminate 1099’s for owners each an every year. For a brief summary read below.
Starting in 2011, there is a new tax requirements for landlords. All landlords who receive $600 or more in rent for the year must send a 1099 to all service providers that the landlord paid $600 or more during the year, such as plumbers, carpenters, yard services, and repair people.
The new requirement applies to owners of both residential and commercial property. Prior to 2011, this requirement had only applied to those involved in full-time property management, but now the requirement covers all types of landlords. Landlords will need to gather federal tax ID numbers from service providers in order to file the 1099s. Failure to file the 1099s with the IRS can result in fines of $50 per 1099 not filed with the IRS. In 2012, these requirements will expand to cover providers of good to landlords.
Please contact our office for more information or send us an email for a free handout.