1099-MISC Guidelines
A 1099-MISC form is required by the IRS to be issued to independent contractors, other individuals, or unincorporated businesses that have received payments of $600 or more in a calendar year. The Financial Accounting area within the Controller's Office produces the 1099-MISC form, sending one copy to the vender and one copy to the IRS.
1099 REPORTABLE PAYMENTS
Some types of non-employee compensation that must be reported by an employer on Form 1099-Misc include:
- Payments to non-employees for services rendered including payments for fees, honoraria, commissions and personal service contracts.
- Payments to recipients other than real estate agents for rental of property and equipment.
- Royalty payments of $10 or more per year.
- Prize and award payments that are not for services rendered.
- Medical and health service payments including payments to corporations.
- Legal services.
With the exception of payments for medical and legal services, only payments to individuals and partnerships are 1099 reportable. Scholarship and fellowship payments are not within the scope of 1099 reporting.
For single payments to current ISU employees for services rendered outside of their current position, please use the One Time Pay Authorization Form. Please note that as of January 1, 2014, student employees cannot be paid via a One Time Pay Authorization form. All student employment should be routed through the Career Center.
For questions related to the classification of an individual as an independent contractor versus an employee, please contact Barbara Tschida.
PAYMENT PROCEDURES FOR 1099 VENDORS
The University is responsible for obtaining correct supplier information for 1099 vendors, which includes the supplier name, address, social security number/employer identification number, and type of organization. This information is collected with the W-9 Request for Taxpayer Identification Number and Certification form. This form must be collected from the vendor for all first-time vendor payments and sent with the check request.
Request for 1099 reportable payments will be processed using a University check request with the following information:
* Full legal name of payee
* Permanent home address
* Social security number or tax identification number
* Payment description
If a 1099 reportable vendor is being paid for services and travel and/or reimbursed expenses, these must be processed on separate check requests to ensure the reimbursed expenses aren't included on the 1099-MISC form.