FORMS: 9.2 FORM 1099
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This form is used to explain the purpose of an IRS form 1099. It helps make the distinction between income and "gross income" or "taxable income". IRS routinely ignores the distinction between these and you often need to emphasize this distinction.


Form 1099

"(a) Returns regarding remuneration for services

If - (1) any service-recipient engaged in a trade or business pays in the course of such trade or business during any calendar year remuneration to any person for services performed by such person, and (2) the aggregate of such remuneration paid to such person during such calendar year is $600 or more, then the service-recipient shall make a return, according to the forms or regulations prescribed by the Secretary..." [26 USC 6041A]

"(a) Returns regarding remuneration for services-

In general. If- (i)Any service-recipient engaged in a trade or business pays in the course of that trade or business during any calendar year after 1982 remuneration to any person for services performed by that person, and (ii) The aggregate amount of remuneration paid to such person during such calendar year is $600 or more, Then the service-recipient shall make a return in accordance with paragraph (e) of this section...
For purposes of this paragraph (a)(i) only, the term remuneration does not include amounts paid to any person for services performed by such person if the service-recipient knows that such amounts are excludable from the gross income of the person performing such services." [26 CFR 1.6041A-1 (proposed)]