1099MISC reports Miscellaneous Income such as
- Rent (Box 1)
- Royalty payments (Box 2)
- Prizes and awards that are not for services, such as graduation prizes, winnings on Vegas nights, or winnings on TV or radio shows (Box 3)
- Payments for services performed for a trade or business by people not treated as its employees, e.g., fees to subcontractors or directors (and reimbursements if no original receipts were attached with the payment request) (Box 7)
- If an employee dies during the year, the accrued wages, vacation pay, and other compensation paid after the date of death (Box 7)
- It also reports any federal income tax withheld (Box 4) if any. For example, persons who have not furnished their TIN are subject to withholding at a 28% rate on payments required to be reported in boxes 1, 2 (net of severance taxes), 3, 5 (to the extent paid in cash), 6, 7 (except fish purchases for cash), 8, 10, and 14.
Cumulative payments of $10 and more in royalties or $600 and more for all other types of income for the calendar year are reported on Form 1099MISC. In addition, any federal income tax withheld is reported.
All income even if lower than $600 and thus not reported on Form 1099MISC needs to be reported on your federal and state income tax return.
Form 1099MISC is not sent to tax-exempt organizations, the United States, a state, the District of Columbia, a U.S. possession, or a foreign government. The same is true for most payments to corporations.
Prizes and awards given to employees based on their performance at work are reported on Form W-2.
Status: January 20, 2009