Landlord Quick Tip

Tip #83:  New Recordkeeping Requirement

The Small Business Jobs Act that was passed at the end of September includes a new  tax reporting provision for landlords.

landlord helpLandlords who pay out $600 or more to a contractor or vendor for work or services related to the rental property must now complete 1099-MISC’s for each. This appears to  include payments to accountants and attorneys as well.

That means landlords will need to ask for tax ID info, store the names and addresses of each contractor, and track the total expenditures made to each person. A W-9 form can be used to collect tax identification numbers.

The new rules go into effect the first of the year.

There will be some exemptions in cases where a landlord’s rental income is nominal, or where this requirement creates a hardship.

Penalties for failure to comply can reach $250 per 1099, so talk to your accountant to find out more – and keep track of what they charge you.

See last weeks Landlord Quick Tip.

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