The new requirement applies to owners of both residential and commercial property. Prior to 2011, this requirement had only applied to those involved in full-time property management, but now the requirement covers all types of landlords. Landlords will need to gather federal tax ID numbers from service providers in order to file the 1099s. Failure to file the 1099s with the IRS can result in fines of $50 per 1099 not filed with the IRS. In 2012, these requirements will expand to cover providers of good to landlords.
NAR(National Association of Realtors) actively opposed this change in the law and is working with others to have this requirement repealed or otherwise modified. Congress took this action in order to assure that income paid to contractors can be verified through a section 1099.
This information is provided to help our Cedar Creek Lake real estate clients understand and collect the information early.
Neal Mansfield & Katie Veach
Keller Williams Realty
(214) 837-8985
1805 W. Main St, Gun Barrel City, TX
Serving the real estate needs of Eustace, Gun Barrel City, Mabank, Malakoff, Seven Points, Tool and Trinidad, TX
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