January 28, 2014

Form 1099-MISC Failure to File Penalties

Question:

Are there any consequences for a church forgetting to file a required Form 1099-MISC? If so, what are they?

Answer:

An organization or individual who fails to file a Form 1099-MISC as required by the IRS and cannot show reasonable cause may be subject to severe financial penalties, as outlined in the IRS instructions for the form:
  • $30 per information return if you correctly file within 30 days; maximum penalty $250,000 per year ($75,000 for small businesses)
  • $60 per information return if you file correctly more than 30 days after the due date but by August 1; maximum penalty $500,000 per year ($200,000 for small businesses)
  • $100 per information return if you file after August 1 or you do not file required information returns; maximum penalty $1,500,000 per year ($500,000 for small businesses)
Based on these penalties, churches should be mindful of the filing requirements. For more on this, please see a preceding post regarding who must file Form 1099-MISC.

2 comments:

  1. Our church became more familiar with the requirements of filing the 1099-MISC this year. We intend to file the 1099-MISC statements for 2015 going forward. We have not filed the 1099-MISC forms consistently over the last 30 years. Do we need to go back and file 1099-MISC forms for years before 2015? Thanks.

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  2. Anonymous, we suggest you seek professional assistance to determine if prior-year Forms 1099-MISC are to be filed.

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