If you are new to keeping records for your company, it can be difficult to make sense of all the IRS forms you need to file. Here is a simple explanation of what information a 1099 contains and why some staffing agencies receive them while others do not.

What Is a 1099?

A 1099 is a form a business gives to contractors and vendors, stating how much the company paid for their services. It differs from a W-2 form in that employers do not withhold any earnings from contractors in the way they do regular employees. Thus, a company for which your staffing agency supplies workers would issue you a 1099 at the end of the year.

Which Agencies Receive Them?

According to https://www.wwspi.com/, businesses are only required to send 1099s to non-incorporated agencies they employ; they do not send them to incorporated ones. If your agency is an LLC, a sole proprietorship, or a limited partnership, then you will receive a 1099 form at the end of the year from any businesses that paid $600 or more for services you rendered.

In summary, only non-incorporated staffing agencies receive 1099s. If your company is incorporated, then the 1099 is one less piece of paperwork you have to worry about this tax season.