Form 1099-MISC Information and Instructions

Note: when your church hires someone to perform services such as janitors, secretaries, nursery workers, etc., they are not independent contractors. They are most likely considered employees and should be issued W-2s. You can research the IRS Pub 15, page 3 to see who the IRS defines as an employee.

For independent contractors, payments for services subject to self-employment tax go in box 7 - Nonemployee compensation.

Services include independent contractors who provide a service. Some examples of independent contractors include: repairmen, accountants, attorneys, cleaning services, and lawn care services.

You should also provide a form 1099-MISC to landlords, revival ministers, supply preachers and guest speakers if total paid to them in the year was $600 or over. Do not send a form 1099-MISC’S to corporations.

One of my readers spoke to an IRS agent regarding this subject. This was the IRS agent's reply:

"1099-MISCs are not required for payments to electricians, plumbers, or similar SE individuals who are coming in for a short-term job. For example, a plumber who comes in to install or repair the bathroom sinks, does not require the church to distribute a form 1099-MISC.

Independent Contractors who should get a 1099-MISC are non-employees who are hired for a longer period. For example, the church hires Mr X and Mr Y for three months to build a garage. They should be provided with a 1099-MISC.

Direct payment to traveling evangelists or missionaries would also receive a 1099-MISC if the annual amount provided to the individual is greater than $600."

(Thank you Roy Lainson for obtaining this clarification for us.)

You should not pay an independent contractor until you have received a completed and signed W-9.

Use Form W-9 "Request for Taxpayer Identification Number and Certification" to obtain names, address, and taxpayer identification numbers (SSN or FEIN) from people you will be required to provide 1099-MISCs.

Have all independent contractors fill out a W-9 even if you think they are incorporated. If they are, there is a place on the W-9 for them to indicate they are incorporated.

When are the forms due?

*Notice: You cannot download a usable 1099 from the web! The original that’s filed with the IRS is printed in red ink and is read by a scanner.

You can order forms from the IRS at no charge, or purchase them from an office supply store. You can reach IRS at 1-800-TAX-FORM to request the ones you need. Make sure to get the transmittal form too. It is Form 1096.Form 1096 is the cover page for the 1099s that will be submitted to the IRS. The 1096 summarizes the total payments included on all of the 1099s. Click here to view instructions for the IRS form 1099.

How do you complete a 1096?

1. Fill in your church/nonprofit’s information. Check the box at the bottom to indicate the type of form being filed. For example, check the box for 1099-MISCs if you are filing 1099-MISCs.

2. Fill in the number of (1099-MISCs) forms you issued on line 3.

3. Fill in the total amount of payments from your forms (1099-MISC) on line 5.

4. Sign your name, title, and date .

5. Mail to the correct IRS address. Addresses are on the second page of the Form 1096.

Go to Church Accounting from Form 1099-MISC