W9/1099 Question

[ChrisPoly945]

California

My Property manager (PM) was terminated from the company for numerous mistakes. One thing I noticed she did was hire contractors (handymen, day workers, laborers, etc) but never got a 1099. She then issued payment to them but again never collected a 1099. I was able to get a few 1099s from a few of them, but one in particular is about $50,000 or so and he won't provide it (probably because he doesn't have a SS#).

It was my PM's responsibility to get all W9's and she dropped the ball. She also did not even attempt to get the W9's after I asked her for them.
I want to know if I will be able to add the amount paid to them, to her 1099 since she hired them and my company had nothing to do with it?
Also, I want to tell the other contractor who hasn't provided his W9 that we are not going to pay him (roughly $5-10K) until he does. Can I do that?

My agreement with her is silent to it this, and she is an independent contractor not an employee.

 

[Zigner]

California

My Property manager (PM) was terminated from the company for numerous mistakes. One thing I noticed she did was hire contractors (handymen, day workers, laborers, etc) but never got a 1099. She then issued payment to them but again never collected a 1099. I was able to get a few 1099s from a few of them, but one in particular is about $50,000 or so and he won't provide it (probably because he doesn't have a SS#).

It was my PM's responsibility to get all W9's and she dropped the ball. She also did not even attempt to get the W9's after I asked her for them.
I want to know if I will be able to add the amount paid to them, to her 1099 since she hired them and my company had nothing to do with it?
Also, I want to tell the other contractor who hasn't provided his W9 that we are not going to pay him (roughly $5-10K) until he does. Can I do that?

My agreement with her is silent to it this, and she is an independent contractor not an employee.

This link should answer your questions:

http://bfy.tw/3yOQ

 

[justalayman]

My Property manager (PM) was terminated from the company for numerous mistakes. One thing I noticed she did was hire contractors (handymen, day workers, laborers, etc) but never got a 1099. She then issued payment to them but again never collected a 1099. I was able to get a few 1099s from a few of them, but one in particular is about $50,000 or so and he won't provide it (probably because he doesn't have a SS#).

HUH? You do not get a 1099 from them. You would issue a 1099 (where appropriate) to an entity you paid. How you got a 1099 from a contractor is quite puzzling. If you asked me for one (of course having performed work for you) you would get a very puzzled expression and a "whatchoo talkin' 'bout?"

but you do not necessarily provide a 1099 to all entities you pay money to either.

I want to know if I will be able to add the amount paid to them, to her 1099 since she hired them and my company had nothing to do with it?

that would all depend on your contract with her. For all anybody knows you should never have issued a 1099 to any of the contractors. It will depend on the contractual relationship between you and your property manager and what their obligations were.



Maybe your PM was doing a better job than you realize.

 

[Zigner]

HUH? You do not get a 1099 from them. You would issue a 1099 (where appropriate) to an entity you paid. How you got a 1099 from a contractor is quite puzzling. If you asked me for one (of course having performed work for you) you would get a very puzzled expression and a "whatchoo talkin' 'bout?"

but you do not necessarily provide a 1099 to all entities you pay money to either.



that would all depend on your contract with her. For all anybody knows you should never have issued a 1099 to any of the contractors. It will depend on the contractual relationship between you and your property manager and what their obligations were.



Maybe your PM was doing a better job than you realize.

Psstt: The OP means he can't get a W9 so that he can issue a 1099.

 

[justalayman]

Psstt: The OP means he can't get a W9 so that he can issue a 1099.

do you not understand [whatever literary device it would be when you use a persons obvious incorrect statement coupled with hyperbole] to impress a point????



It wasn't really that but it sounded (sort of) good (if I could have given it a proper label)


the point really is; OP does not understand what is happening enough to be able to ask a question using proper terminology. When considering that and then asking questions such as; can I add the money onto the PM's 1099, well, well,

well, I'm just so bothered I cannot even finish the statement.

but the fact the OP uses 1099 and W9 properly here:

It was my PM's responsibility to get all W9's and she dropped the ball. She also did not even attempt to get the W9's after I asked her for them.
I want to know if I will be able to add the amount paid to them, to her 1099 since she hired them and my company had nothing to do with it?

suggests your pssssst was not proper. She does know the difference as proven in that statement.

 

[tranquility]

California

My Property manager (PM) was terminated from the company for numerous mistakes. One thing I noticed she did was hire contractors (handymen, day workers, laborers, etc) but never got a 1099. She then issued payment to them but again never collected a 1099. I was able to get a few 1099s from a few of them, but one in particular is about $50,000 or so and he won't provide it (probably because he doesn't have a SS#).

It was my PM's responsibility to get all W9's and she dropped the ball. She also did not even attempt to get the W9's after I asked her for them.
I want to know if I will be able to add the amount paid to them, to her 1099 since she hired them and my company had nothing to do with it?
Also, I want to tell the other contractor who hasn't provided his W9 that we are not going to pay him (roughly $5-10K) until he does. Can I do that?

My agreement with her is silent to it this, and she is an independent contractor not an employee.

I'm not completely sure about all the facts, but to the IRS you are the one responsible for issuing a 1099 in order to deduct that level of expenses. You may have contractual remedies against your agent if they were in breach of your agreement. (IC or employee is not really relevant.) You might find your building get a mechanic's lien if you don't fulfill whatever the contract was with the person who has not provided his information. You would be able to remove that as you would not be in breach if you followed the law. (https://www.irs.gov/pub/irs-pdf/p1281.pdf)

 

[Zigner]

I want to know if I will be able to add the amount paid to them, to her 1099 since she hired them and my company had nothing to do with it?

No, that would NOT be proper since you didn't pay HER the money. And, c'mon, you KNOW that they were hired by an agent for your company (ETA: and, on behalf of your company), thus it's your company that hired them.

 

[Zigner]

suggests your pssssst was not proper. She does know the difference as proven in that statement.

She definitely knows the difference, you're right. But I still think I was right in my interpretation of things

 

[justalayman]

No, that would NOT be proper since you didn't pay HER the money. And, c'mon, you KNOW that they were hired by an agent for your company (ETA: and, on behalf of your company), thus it's your company that hired them.

I can imagine a scenario where it would be proper to consider all money paid to the PM. I don't think it is in this situation (or is it) but it could be done that way (and in my opinion, it would make life easier for a person in the position of the OP).

 

[Zigner]

I can imagine a scenario where it would be proper to consider all money paid to the PM. I don't think it is in this situation (or is it) but it could be done that way (and in my opinion, it would make life easier for a person in the position of the OP).

In this situation, the OP (or the OP's company) paid the contractors directly - it wouldn't be proper to issue a 1099 to the PM for those payments.

 

[LdiJ]

I'm not completely sure about all the facts, but to the IRS you are the one responsible for issuing a 1099 in order to deduct that level of expenses. You may have contractual remedies against your agent if they were in breach of your agreement. (IC or employee is not really relevant.) You might find your building get a mechanic's lien if you don't fulfill whatever the contract was with the person who has not provided his information. You would be able to remove that as you would not be in breach if you followed the law. (https://www.irs.gov/pub/irs-pdf/p1281.pdf)

OP's company would not have to issue a 1099 if any of the companies to be paid or who were paid are corporations. Perhaps that is part of the problem? I know that at one time the IRS intended (or maybe it was congress who intended) for people with rental properties to issue 1099's to absolutely everyone, even corporations, but that got shot down before it ever got fully implemented.

 

[tranquility]

OP's company would not have to issue a 1099 if any of the companies to be paid or who were paid are corporations. Perhaps that is part of the problem? I know that at one time the IRS intended (or maybe it was congress who intended) for people with rental properties to issue 1099's to absolutely everyone, even corporations, but that got shot down before it ever got fully implemented.

Good point. I suspect it is not the case, but was not through. (That's the power of the forum, many eyes.)

 

[davew128]

Good point. I suspect it is not the case, but was not through. (That's the power of the forum, many eyes.)

Agree with her.

Tangential case, my firm invoices an individual for preparing his tax return. He asks one of the partnerships he's invested in to pay us the invoice. Now the controller calls ME asking for a W-9 to 1099 us. Consider that. We didn't render services to the partnership at all. They're basically diverting a capital distribution to a partner to us. I told the controller that A)We're a corporation and exempt from 1099 issuance and B)We're not a vendor to you. Response from her was a threat to withhold payment "because its our policy to 1099 everyone". Needless to say, the woman on the other end didn't appreciate being called a dumbass and my counter threat of refusing to prepare the partners next return if payment wasn't received. Point is, a lot of places are anal retentive when it comes to 1099s, and ignore the baseline of who gets it and simply issue them to everyone.

As to the OP's case, if you read between the lines here, the state is CA and we're talking about handymen, laborers, and landscapers. Now can anyone think of a reason why some of those people might not respond to a W-9 request? Think about it for a minute.

 

[tranquility]

I agree with the point of the story, but am uncertain as to the question. Wouldn't one need to prove the money was paid to a corporation?

You don't just get to say to an audit, " I thought it was a corporation".

 

[LdiJ]

I agree with the point of the story, but am uncertain as to the question. Wouldn't one need to prove the money was paid to a corporation?

You don't just get to say to an audit, " I thought it was a corporation".

Nine and a half times out of ten an invoice from a corporation is going to have "inc", or a similar abbreviation in its name. I have never had an IRS agent, in an audit, squawk when the invoicing says "inc.". Lots of construction companies, plumbing companies, landscaping companies etc. are corporations. Of course, lots of them may be undocumented workers as well, but that doesn't change the fact that lots of them are corporations.

I understand Dave's comments about some of them being anal. Years ago I was constantly explaining to vendors that we were a corporation, selling a product not a service, and therefore we did not have to provide a W9, and would not do so. They would threaten not to pay for the product, and I would say fine, send it back. Nobody ever sent it back.