LUTZ BUSINESS INSIGHTS

 

Form 1099 for Healthcare

2021 Form 1099 Filing Best Practices for Medical Groups

lauren duren, healthcare & CAS manager
erin baas, CAS director

Any person, including a corporation, partnership, individual, estate, and trust, who makes “reportable transactions” during the calendar year, must file information returns to report those transactions to the recipients by January 31, 2022.

Generally, payments to sole proprietorships, partnerships, and LLCs who receive payments for services should receive a Form 1099.  You should request a completed Form W-9 from your vendor to obtain the information necessary to complete the Form 1099 prior to payment. Forms W-9 can be obtained at www.irs.gov.

common payments that may require issuing a form 1099 INCLUDE THE FOLLOWING ITEMS:

  • Payments of $600 or more for services performed for your business by people not treated as your employees, such as fees to subcontractors, professional fees, directors, cleaning services, referral fees, and temporary help.
    • Some examples of this could include the following: outsourced IT services, billing or management company services, janitorial services, contract providers or locum tenen coverage payments, transcription services, medical waste removal, nurse staffing, interpreter or language services, collection agency, accounting, legal, consulting professional fees, retirement plan administrators, contractors hired for repairs and maintenance, statement printing services, website development,
    • Please note there are facts/circumstances that may dictate if any of the above examples would be considered an independent contractor versus an employee that should receive a W-2
  • Rent payments of $600 or more, other than rents paid to real estate agents;
    • This is applicable even if you pay rent to an entity you own (if it’s a partnership)
  • Payments for medical and legal services over $600, even if payments made to an incorporated entity;
  • Interest and dividends payments of $10 or more to unincorporated entities (please note: payments to owners of S Corporations are not dividends but distributions that do not require 1099 reporting);
    • Redemption or deferred compensation payments to retired members or shareholders that have accrued interest
  • Payments from which you withheld federal and/or state income tax under the backup withholding rules regardless of the amount of the payment.

The Forms 1099-NEC (Nonemployee Compensation) are due to the IRS and recipients by January 31, 2022.

The other Forms 1099s are due to the recipients by January 31, 2022, as well but are not due to the IRS until February 28, 2022.

Please note: if the vendor providing services to your company is located outside Nebraska (i.e., the address where you will be mailing the Form 1099 is not a Nebraska address) but is performing services within Nebraska, you may be required to withhold Nebraska income tax on the payments made to the vendor. This is common with providers being hired on a contract basis if their home is located outside Nebraska.   Please contact your Lutz representative for further information about the requirements for state income tax withholding for Forms 1099.

Lutz would be happy to assist you in the preparation of the 2021 Forms 1099. Please contact us or call us at 402.496.8800.

 

ABOUT THE AUTHOR

402.827.2062

lduren@lutz.us

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LAUREN DUREN + HEALTHCARE & CAS MANAGER

Lauren Duren is a Healthcare & CAS Manager at Lutz with over six years of relevant experience. She provides healthcare consulting, as well as outsourced accounting services to clients with a focus on QuickBooks, tax, and payroll compliance.

AREAS OF FOCUS
  • Healthcare Accounting Consulting
  • Outsourced Accounting
  • Tax
  • Payroll Compliance
  • QuickBooks
  • Financial Reporting, Budgeting & Forecasting
  • Provider Compensation Plans
  • Practice Benchmarking
  • Private Physician Practices
  • Nonprofit Industry
AFFILIATIONS AND CREDENTIALS
  • American Institute of Certified Public Accountants, Member
  • Nebraska Society of Certified Public Accountants, Member
  • National Medical Group Management Association, Member
  • Nebraska Medical Group Management Association, Member
  • Certified Public Accountant
EDUCATIONAL BACKGROUND
  • MBA, University of Nebraska, Omaha, NE
  • BSBA in Accounting, University of Nebraska, Omaha, NE
COMMUNITY SERVICE
  • Lutz Gives Back, Volunteer
Erin Baas + Lutz CAS & Healthcare Manager

402.827.2045

ebaas@lutz.us

LINKEDIN

ERIN BAAS + CAS DIRECTOR

Erin Baas is a Client Accounting Services Director at Lutz with over 15 years of experience. She provides business accounting and advisory services to a wide variety of industries with a special focus in private physician medical practices.

AREAS OF FOCUS
AFFILIATIONS AND CREDENTIALS
  • American Institute of Certified Public Accountants, Member
  • Nebraska Society of Certified Public Accountants, Member
  • Nebraska Medical Group Management Association, Member
  • Certified Public Accountant
EDUCATIONAL BACKGROUND
  • BSBA in Accounting, Creighton University, Omaha, NE
COMMUNITY SERVICE
  • Nebraska Wildlife Rehab, Treasurer

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