We had a reader send in the following question:
"I really got my-self confused by reading to much. I need some clarification on the new upcoming requirement on filing 1099’s. I know that it goes into effect for tax years after 12-31-2011. Where I am confused is CCH say it is for amounts paid after 12-31-2011 so the 1099’s will be filed in 2013. I just read a article in the Kiplinger Tax Letter that say this new law effects 1099’s filed in 2012, so that means for amounts paid in 2011 . Is this correct or is it for amounts actually paid in 2012."
The new law passed early in 2010 requires businesses to start filing form 1099s for all transactions where the total purchases to one vendor during the year reaches or exceeds $600. This law is effective for purchases made after December 31, 2011 or the calendar year 2012. This means that the form 1099 will need to be sent to the vendors in January 2013 and reported to the IRS usually by February 28, 2013.
So the bottom line answer that this new rule is for purchases made in 2012, and filed in 2013.
There is much speculation that this law will be repealed this year.