What businesses need to know about reporting non-employee compensation and backup withholding to the IRS

tysllpBusiness Advice, Tax Accounting

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When a business hires an independent contractor, the employer is generally not responsible for withholding income taxes, Social Security, or Medicare taxes from their compensation. However, by law, business taxpayers who pay non-employee compensation of $600 or more must report these payments to the IRS. They do this using Form 1099-NEC, Non-employee Compensation. Generally, payers must file Form 1099-NEC by January … Read More