How Do I File A 1099?

Well, my spouse wanted to help a friend become an owner-operator but his friend bought his truck BEFORE his MC# was established. The friend obviously can't get loads without it. We also leased our own trailer to him really cheap (just the monthly loan payment on it). So my spouse agreed to get the friend his loads using our MC#, until his MC# was figured out. His the payments came to us, we in turn paid him every cent of the rate of each load. Well, the friend decided to sell his truck six months later when it started having tons of mechanical repairs. The friendship also ended when he didn't want to pay for the last two months of using our trailer. Goes to show some people just don't appreciate a good thing. The problem that worries me most, that the tax person said we have to file a 1099 because we received the the friend's money on his behalf. I found the form, but HOW do I file a 1099? will we end up paying IRS penalties?

You will have to issue a 1099 to him for all the money you paid/passed on to him since he wasn't an employee you weren't required to withhold taxes or issue him a W-2. I hope this helps.

I am not a tax professional and you may want to ask one just to be sure. You also might want to post this on the general forum. I'm going to "report" my reply so maybe Brett or someone who's certainly more knowledgeable that me because they've dealt with this type of stuff much more recently than I have lol.

You will give this friend a Form 1099 in January 2018. Like W-2 forms from employers, you need to have sent it to him by January 31st. You will fill out and file Form 1096 with the IRS (by February 28th) so that the IRS can match the 1099. Don't forget to include this amount on your own tax filing as a business expense. You can contact the IRS to have them send you a blank version of the Form 1096, unless you use tax software that includes the ability to e-file that form. (Generally, this is a form you can't just print off on blank paper and expect the IRS to accept. The 1096 form looks like this: https://www.irs.gov/pub/irs-pdf/f1096.pdf If you have your own business I'm sure you already are familiar with a 1099.

No penalties unless for some reason you miss those deadlines.